AP, TS reel under cash-crunch bogey 

It is one month and four days since the time Prime Minister Narendra Modi announced demonetization of Rs 500 and Rs 1000 notes. The bolt from the blue has thrown life out of gear, and continues to be so. There has been no relief, whatsoever, from the problems being faced by the common man.

We are confronted with a uniquely common feature across the country-long queues before ATMs; a mad scramble in banks to withdraw cash; bankers more willing to ‘oblige’ with Rs 2000 notes rather than smaller denomination notes despite loads of those bundles in the branch chest; arguments between the irate customers and the ‘less-than-friendly’ bankers venting their frustration and sporadic violence here and there. In a way, for all the good intentions, there is still a sense of negativity and anger all, around.

The daily-wage earners lament that even after standing in serpentine queues for close to four hours, there was no assurance that they would be able to withdraw cash and procure their day-to-day requirements. Housewives complain that they are unable to buy goods from market as the availability of cash has come down drastically. Auto-rickshaw drivers and small time vendors refuse to give change. The Rs 1,000-crore turnover food and beverages segment in Hyderabad has taken a massive hit due to the decision to pull Rs 500 and Rs 1,000 out of circulation.

‘No cash’ boards pop up within a couple of hours of opening the branch while only a paltry 10 to 15 percent ATMs are functioning. And ATMs dispensing new and crispy Rs 500 note is still a rare happening. This scenario is common in both the Telugu-speaking States. This is in startling contrast to the ground-realities in Chennai and New Delhi, where such problems either don’t exist or are in miniscule numbers.

In Chennai from an auto driver to the bandiwallah everyone has enough notes of smaller denominations like Rs 10, Rs 50 and Rs 100. No one cribs. If the autowallah demands Rs 40 for a short distance and the passenger hands him a Rs 100 note, he returns the change without batting an eyelid.

There are no long queues before banks. Yes the functioning of ATMs is not 100 percent normal but flow of liquid cash in the market is pretty good. In Delhi too, the queues before ATMs are gradually on the wane. At any given point of time, not more than 10 people are found. Change is no more a problem there.

This obviously means that either the Centre has been sending more money to the banks in those metros or there is less hoarding of smaller notes both by the people and the bankers as compared to Andhra Pradesh and Telangana State. Interestingly several instances of illegal conversion of demonetized notes also surfaced more in the two Telugu states.

The Central Bureau of Investigation (CBI) unearthed a scam where bank officials colluded with private parties. IT sleuths arrested the prime accused in the postal cash exchange scam, K Sudheer Babu, and two fellow-conspirators T Nitin and V Narasimha Reddy.

Nitin is a law student at Pendekanti College, and V Narasimha Reddy is an Australian citizen. They collected the money in old demonetised notes from their friend Sudheer Babu, Hyderabad postal department head, and exchanged it for new Rs 2000 notes for a commission of one or two per cent. Sudheer Babu is a close friend of Nitin as they had prepared for the Civil Services exams together.

The CBI believes that Sudheer Babu has siphoned-off at least Rs 2.95 crore. The IT department raided several jewellery shops in Telangana State and Andhra Pradesh and is probing into their business trends since November 8. Many big jewelers are under the IT scanner. Cases against some have been booked.

Ostensibly, the prized catch appears to be on the TTD Board member J Sekhar Reddy. Following an income Tax raid on Sekhar Reddy, the Andhra Pradesh government decided to remove him from the Board. So far the IT department has found Rs 114 crore in cash and more than 100 kgs of gold has been seized from him the houses of his friends and relatives, including a whopping Rs 94 crore worth of Rs 2,000 notes.

How did so much money go out is the million dollar question. Apparently, so much cash cannot move out the banks without it being an inside job. Unless such illegal activities are curbed, the cash crunch in the two Telugu states is likely to continue, much to the embarrassment of the authorities and discomfort of the common man, for no fault of his.

By V RAMU SARMA