Andhra Pradesh Chief Minister N Chandrababu Naidu has hailed the demonitisation of `1,000 and `500 currency notes and claimed that he had made the demand to take such an action in a letter to Modi. “It is a revolutionary decision. It will strengthen our financial system,” he said. “It will go a long way in eradication of corruption and black money”,he told the media in Vijaywada.
Naidu said he was happy that the Centre had taken his letter to Prime Minister Narendra Modi into consideration. Incidentally the issue of cancellation of the higher denomination currency notes had come up at the Press conference of Chandrababu Naidu with the Niti Ayog Vice-Chairman Arvind Panagariya hours before the Prime Minister Modi’s announcement.
A journalist sought the reaction of Panagariya to Naidu’s letter demanding scrapping of `500 notes and on the reports that the Center was planning to introduce `2,000 denomination notes.
Panagariya said that the issue was under discussion for a long time and even American economist Kenneth Rogoff had also suggested that American Government should scrap big currency notes.
Intervening on the issue Chandrababu Naidu said, “`500 and `1000 notes were being used only by the upper classes and they were the biggest cause of rise in corruption.”
Naidu suggested that even the masses should do cashless transactions through banks and he had conducted a successful experiment of it in Krishna district. While all this was being discussed in the Press Conference, none had an inclination of the imminent surgical strike by Modi.
However when it came, all hell break lose as the common citizen were left to fend for themselves.
Not knowing the alternatives the panic stricken people rushed to the petrol bunks and nearest ATMs to change their big currency notes without any success.
Though the new order was supposed to come into effect from the midnight hotel and grocery stores and even medical stores started refusing the Rs 500 and the 1000 currency notes.
"I don't have change", an agitated shop owner said when the customer insisted that he should accept the Rs 500 note till midnight".
Things were threatening to turn violent at petrol pumps and the toll plazas as people did not have smaller currency.
The closure of banks and the ATMs on Wednesday only worsens the situation for the common folks. Markets were deserted and the shops and hotels, eateries and grocery stores not having credit card facilities had lesser foot falls as ordinary people sat tight waiting for the banks to re open.
Thursday was likely to see unprecedented rush at the bank doors as millions will queue up all over India to get their currency exchanged.
The sudden decision of the Prime Minister to scrap the higher denomination notes has opened a new window of opportunity for some.
As the worried people lined up at the ATMs in Hyderabad to draw money hoping to get Rs 100 notes some people out to make fast bucks started offering Rs 300 for Rs 500 and Rs 600 for Rs 1000 note making up to 40 per cent commission.
People unaware that they can legally exchange their money at the banks from Thursday soonfell prey to the road side currency exchange agents.
This was happening right under the nose of Reserve Bank of India’s office at lakdi Ka Pul which not far from the state headquarters of the police and intelligence.