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Cash crunch: ATMs run dry, FM Jaitley says problem temporary

Published

8 years ago

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Cash crunch: ATMs run dry, FM Jaitley says problem temporary

For many in India, it is back to demonetisation days and cashless transactions as automated teller machines (ATMs) in many states running out of money.

Shortage of cash has been reported from Gujarat, Uttar Pradesh (UP), Madhya Pradesh (MP), Bihar, Andhra Pradesh (AP), Manipur and Telangana.

Reserve Bank of India (RBI) found that the rate of cash withdrawal was much higher than the rate of cash deposits in AP, Bihar, Karnataka, Maharashtra, Rajasthan, UP, MP and Telangana, among other states. The RBI on Tuesday, April 17, formed a committee to tide over the crisis.

Complaints of cash crunch have been reported from semi-urban and rural regions of the states.

Although the rate of cash circulation has surpassed the pre-demonetisation level, it is not in tandem with the rate of economic growth, said a report in the Business Standard (BS). The notes in circulation on November 4, 2016 – four days before the Union government announced demonetisation of Rs 500 and Rs 1,000 notes – were Rs 17.74 trillion while the currency notes in circulation are now at Rs 18.04 trillion. The cash in circulation-to-GDP ratio before demonetisation stood at 11.6% and it has declined to 10.7% at present, said the BS report.

Union Finance Minister Arun Jaitley blamed the “temporary shortage” of cash on the “sudden and unusual increase” in withdrawals in some areas. “Have reviewed the currency situation in the country. Over all there is more than adequate currency in circulation and also available with the Banks. The temporary shortage caused by ‘sudden and unusual increase’ in some areas is being tackled quickly,” Jaitley tweeted.

Minister of State in Finance Shiv Pratap Shukla told TV channels: “There is an issue of disparity. Some states have less currency and the others have more. Government has formed state-wise committee and RBI has also formed a committee to transfer currency from one state to the other. In two-three days, this problem will be resolved.”

The Finance Ministry said in a statement: “There has been unusual spurt in currency demand in the country in last three months. In the current month, in the first 13 days itself, the currency supply increased by Rs.45000 crores. This unusual spurt in demand is seen more in some parts of the country like Andhra Pradesh, Telangana, Karnataka, MP and Bihar. The Government of India with the Reserve Bank of India have taken all steps to meet this unusual demand. We had adequate reserves of currency notes which have been used to meet fully the extraordinary demand generated so far.”

The government said it was going to print five times more currency notes. “We print about 500 crores of Rs 500 notes per day. We have taken steps to raise this production by five times. In the next couple of days, we’ll have a supply of about 2500 crore of Rs 500 notes per day. In a month, supply would be about 70000-75000 crore,” ANI quoted SC Garg, Secretary, Department of Economic Affairs as saying.

Congress President Rahul Gandhi, reacting to the reports, blamed Prime Minister Narendra Modi for “destroying” the banking system. “Modi Ji has destroyed the banking system. Nirav Modi fled with Rs 30,000 crore and PM didn’t utter a word. We were forced to stand in queues as he snatched 500-1000 rupee notes from our pockets and put in Nirav Modi’s pocket,” Rahul Gandhi told ANI.

Gujarat deputy chief minister Nitin Patel told a newspaper few days back that the state is in touch with the RBI to resolve the issue of cash crunch.

“In Gujarat, the currency chests were not getting adequate supply of cash from the RBI,” said an executive director of a public sector bank.

In Bihar, ATMs dried up in north Bihar due to issues related to transportation of cash from currency chests located in other parts of the state, officials said.

The Manipur government also wrote a letter to the finance ministry apprising them of acute shortage of cash in the state.

Possible reasons for cash crunch:

Some bank officials also believe the RBI has deliberately reduced cash supply to banks to force people to make digital payments and increase cashless transactions.

Senior finance ministry officials, who held a meeting with RBI’s currency circulation division, banks and state government officials on Thursday, blamed the shortage of cash to various factors, including mismanagement of cash flow by banks, recalibration of ATMs to support the new currency notes, and logistical issues.

Public sector bank executives also said there is a spurt in demand for cash to make payments for agricultural activities as well.

The Indian Express (IE) reported earlier this month that rumours that the Financial Resolution and Deposit Insurance (FRDI) Bill, proposed last June, will cause losses to depositors if their bank goes bankrupt had allegedly led to heavy withdrawals. It cited bank officials’ statements that people have been withdrawing cash more than they require at the beginning of the month. They blamed the cash shortage over fewer deposits and more withdrawals.

The IE quoted State Bank of India (SBI) regional manager, Visakhapatnam, H Purnima, as saying that this is a phenomenon experienced by all banks since November 2017. “We are unable to refill ATMs because people are not depositing in banks,” she told IE.

On Monday, Madhya Pradesh Chief Minister Shivraj Singh Chauhan claimed there was a conspiracy behind Rs 2000 notes disappearing from the market. Referring to reports of ATMs running out of cash at some places in the state, he said: “Currency worth Rs. 15,00,000 crore was in circulation before demonetisation. After the demonetisation exercise, the currency in circulation increased to Rs. 16,50,000 crore. But notes of Rs. 2,000 are missing from the market. Where these notes of Rs. 2,000 denomination are going, who are keeping them out of circulation? Who are the persons creating shortfall of cash? This is a conspiracy to create problems. The government will act tough on this.”

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Union Budget 2026 highlights: Nirmala Sitharaman Raises Capex to Rs 12.2 Lakh Cr, West Bengal Gets Major Allocation

Finance Minister Nirmala Sitharaman is presenting the Union Budget 2026 in Parliament today. Follow this space for live updates, key announcements, and policy insights.

Published

5 days ago

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February 1, 2026

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Finance Minister Nirmala Sitharaman arrives to present Union Budget 2026

Finance Minister Nirmala Sitharaman will shortly present the Union Budget 2026 in the Lok Sabha, marking her ninth consecutive Budget. The annual financial statement is expected to outline the government’s policy priorities, reform agenda and spending plans for the coming year. Stay tuned for live updates, key announcements and immediate reactions as the Budget speech unfolds.

Finance Minister Nirmala Sitharaman tabled her ninth Union Budget today, beginning her speech at 11 am.

Nirmala Sitharaman is set to present her ninth Union Budget today, with the finance minister scheduled to begin her speech at 11 am.

Budget 2026 live updates: Presenting the Union Budget for 2026–27, Finance Minister Nirmala Sitharaman said the occasion coincided with Magh Purnima and the birth anniversary of Guru Ravidas. She noted that over the past 12 years, India’s economic journey has been defined by stability, fiscal discipline, sustained growth and moderate inflation.

The budgeted fiscal deficit for fiscal 2026 is estimated at 4.4 per cent of gross domestic product (GDP)

Planned capital expenditure this fiscal year Rs 11.2 lakh crore

Rare earth corrdiors in Odisha and Kerala

Hi-tech tool rooms to be set up by PSUs

Construction equipment scheme to be launched

Container manufacturing scheme for Rs 10,000 crore over 5 years

Rs 10,000 crore SME Growth Fund

Semi-conductor mission to get Rs 40,000 crore

Rs 12.2 lakh crores for infrastructure development

Dedicated RITES to repurpose land of Central PSUs

20 new waterways over next 5 years to be connected

7 high-speed corridors on rail

High-level committee on banking for next phase of Viksit Bharat

Capital expenditure hike of to ₹12.2 lakh crore in Budget 2026, with West Bengal receiving a significant share of allocations.

Mahatma Gandhi Gram Swaraj Initiative aimed at boosting the khadi, handloom, and handicrafts sectors.

High-speed rail corridors: Mumbai-Pune, Pune-Bengaluru, Hyderabad-Bengaluru, Chennai-Bengaluru, Delhi-Varanasi, Varanasi-Siliguri, Pune-Hyderabad

Five university campuses to be established near industrial corridors

Lakpati Didi program expanded in Budget 2026 to reach more beneficiaries across India.

Fiscal deficit for FY26 revised to 4.4%; Budget Estimate for FY27 set at 4.3%.

TCS on overseas tour packages cut to 2% to ease travel costs

Tax holiday to foreign companies that provide cloud services by setting up data centres in India till 2047

17 cancer drugs exempted from import duties

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Union budget 2026 to be presented on Sunday with special trading session

The Union Budget 2026 will be presented on a Sunday for the first time in over two decades, with NSE and BSE announcing special trading sessions for the day.

Published

6 days ago

on

January 31, 2026

By

Nirmala Sitharaman

For the first time in more than two decades, the Union Budget will be presented on a Sunday. Finance Minister Nirmala Sitharaman is scheduled to table the Union Budget for 2026 in the Lok Sabha on February 1 at 11 am, even as the day is usually observed as a holiday for government offices and financial markets.

February 1 falls on a Sunday this year, raising questions about market operations and investor response. To ensure uninterrupted trading and immediate market reaction to budget announcements, stock exchanges have announced special arrangements for the day.

Markets to remain open on budget day

Both the National Stock Exchange and the Bombay Stock Exchange have confirmed that markets will remain open on February 1. The NSE has announced a special trading session, with the pre-open market scheduled from 9 am to 9:08 am, followed by normal trading hours from 9:15 am to 3:30 pm.

The BSE has also declared the day a special trading day, with regular market hours applicable. Trading is expected to continue across equity, derivatives, and futures and options segments.

What the Sunday budget means for investors

A weekend budget presentation is seen as offering certain advantages for market participants. With trading active on the same day, investors will be able to respond to policy announcements immediately rather than waiting for the next working day.

The Sunday timing also gives investors, analysts, and financial institutions additional time to go through detailed proposals, including tax changes, fiscal deficit targets, and sector-wise allocations. The extended window for analysis may help reduce sharp, headline-driven reactions and encourage more informed decision-making.

With fewer competing developments on a non-working day, budget announcements are also expected to receive more focused attention from markets and stakeholders.

Parliamentary schedule and key milestones

The Economic Survey is expected to be tabled on January 29, ahead of the budget presentation. The Budget Session of Parliament began on January 28 with the President’s address to a joint sitting of the Lok Sabha and Rajya Sabha.

The upcoming budget will mark Nirmala Sitharaman’s ninth consecutive Union Budget. It will also be India’s 80th budget since Independence. Since 2017, Union Budgets have been presented at 11 am on February 1, following a timing change introduced during the tenure of former finance minister Arun Jaitley.

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Modi says right time to invest in Indian shipping sector; meets global CEOs

Published

3 months ago

on

October 29, 2025

By

PM Narendra Modi

Prime Minister Narendra Modi on Wednesday exhorted global investors to take bets on the Indian shipping sector, pointing out that this is the “right time” for such a move.

The Prime Minister also met a select chief executives of global majors, including DP World and APM, at a specially convened meeting on the sidelines of the India Maritime Week 2025 held here.

“For all of you hailing from different countries, this is the right time to work in the Indian shipping sector and also expand (your presence),” Modi said during a public address before the closed-door meeting with CEOs.

Modi listed several targets being chased by India in the maritime sector over the next few years, and underlined the importance of the global community in the same.

“You all are an important partner who will help us achieve all our aims. We welcome your ideas, innovations and investments,” Modi said.

He said that India allows 100 per cent foreign direct investment in the shipping and ports sector, and also provides incentives under the “Make In India, and Make For The World” vision.

Addressing an audience, including leaders of various companies, the Prime Minister affirmed India’s commitment to strengthening the supply chain resilience at a global level.

He also said that India is engaged in creating world-class mega ports, and cited the work undertaken on the Vadhavan Port to the north of the financial capital, which entered the top-10 firms in the world on the first day.

The government is also looking to grow the capacity at 12 major ports by four times and increase India’s share in containerised cargo at the global level.

Later, Modi held a meeting with top CEOs of shipping sector companies from across the world.

As per people in the know, he met AP Moller-Maersk Chairman Robert Maersk Uggla, DP World Group Chairman Sultan Ahmed bin Sulayem, Mediterranean Shipping Company Chief Executive Soren Toft, Adani Ports and SEZ Managing Director Karan Adani and French company CMA-CGM’s Senior Vice President Ludovic Renou.

The participation from over 85 countries in the IMW sends a strong message, Modi said, noting the presence of CEOs of major shipping giants, startups, policymakers, and innovators at the event.

The Prime Minister also thanked Port of Singapore (PSA) for the nearly Rs 8,000 crore investment in the Jawaharlal Nehru Port Authority’s fourth terminal, pointing out that this is also the largest FDI in the port sector in India.

Modi said more than 150 new initiatives have been launched under the ‘Maritime India Vision’, resulting in nearly doubling the capacity of major ports, a substantial reduction in turnaround time, and a new momentum in cruise tourism.

—PTI

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