No move to re-introduce Rs 1,000 notes

Focus is on production and supply of Rs 500 and lower denomination notes

NEW DELHI: The government has no plans to re-introduce Rs 1,000 and will focus instead on issuing lower denomination currency notes, Economic Affairs Secretary Shaktikanta Das said on Wednesday.

“(There are) no plans to introduce Rs 1,000 notes. Focus is on production and supply of Rs 500 and lower denomination notes,” Das tweeted.

His clarification followed media reports that the government was planning to re-introduce Rs 1,000 notes with a new design.

Referring to complaints of dry ATMs even more than 100 days after the November 8 demonetisation, Das urged people to withdraw only as much cash as “they actually require”. “Overdrawal by some deprives others,” he said.

Post demonetisation, the government introduced new Rs 500 notes along with Rs 2,000 notes.

Over Rs 1 lakh crore worth of the new Rs 500 notes have been printed, with the presses churning out some 22 million pieces every day.

Prime Minister Narendra Modi demonetised the old currency to fight black money and terror funding.

There were 17,165 million pieces of Rs 500 notes and 6,858 million pieces of Rs 1,000 notes in circulation on November 8.

The total amount of high denomination currency circulating in the system on that day was Rs 15.44 lakh crore — Rs 8.58 lakh crore in Rs 500 notes and Rs 6.86 lakh crore in Rs 1,000.

Meanwhile, a leading industry lobby said here on Wednesday that sufficient cash in both rural areas and cities, along with some bold and pragmatic decisions on issues like bank’ non-performing assets (NPAs) will be key drivers for reverting to eight per cent growth of the Indian economy.

Welcoming various steps taken by the government to curb black money and corruption, Assocham President Sandeep Jajodia said people should be encouraged to start spending again.

“However, it must be ensured that there is no tax terrorism and fear psychosis among the consumers, especially of high-value products and services; and trade channels must be avoided,” Jajodia, who recently took over as Assocham President, said in a statement.

“Besides, government officials at all levels should be made accountable for their actions.”

On the government’s efforts in tackling non-performing assets (NPAs) of public sector banks, Jajodia said: “We are faced with a situation where banks, with loads of cash, are finding it hard to lend despite lowering interest rates. Apparently, there are not many takers for credit.”

“The credit off-take from corporate India, in any case, will be quite low as long as the entire issue of non-performing assets and cleaning up of the banks’ balance sheets is not resolved with a pragmatic approach and strong political will.”

Jajodia recommended that a clear distinction should be made between wilful defaulters and those whose business ran into difficulty due to external economic factors like volatile commodity prices, or even those whose commercial decision may appear to be wrong in hindsight.

Referring to a large number of domestic and global macro issues, the Assocham President said the government should further speed up infrastructure projects of roads, highways, railways, ports and airports financed through public funding.

“Creation of jobs for the youth, who are getting added in large numbers every year, is one of the prime responsibilities both for the government and for corporate India,” Jajodia pointed out.