Gurgaon traders welcome new withdrawal limit, bankers expect more chaos

Traders hope the new withdrawal limit of ₹50,000 will bring more cash into the market and replenish the supply of perishables.

Gurgaon: Wholesalers of perishable items such as fruits and vegetables were relieved on Thursday after the Centre extended the over-the-counter withdrawal limit for agricultural traders to ₹50,000 a week. Traders hope the extension of the limit would streamline the cash-dependent markets crippled by demonetisation.

A daily needs shop in Sector 90. On Thursday, there was scarcity of perishables because of depletion of cash in the transport business. (Parveen Kumar/HT Photo)

On Thursday, there was scarcity of commodities because of depletion of cash in the transport business. Trucks and goods carriers came to a dead stop in the Delhi-NCR and the supply of fruits and vegetables to wholesale markets declined by 50%.

“The situation will not improve unless the market is provided cash. The decision allowing farmers to withdraw ₹25,000 per week and agriculture traders ₹50,000 a week is a positive move that will improve the situation,” Inderjeet Thakran, president, Gurgaon sabzi mandi, said.

Though the cash-dependent wholesale market remains the worst hit, the business at retail outlets is also affected. Traders have now switched to cheque transactions because of the paucity of cash.

The over-the -counter withdrawal limit for the general public has been extended to ₹24,500.

However, the move to reduce the limit of demonetised currency exchange in banks to ₹2,000 from ₹4,500 starting Friday is expected to add to the woes of people already hassled by standing in long queues outside banks for more than a week.

Gurvinder Singh, waiting in a queue outside a bank in Sector 34, said he would not leave without exchanging ₹4,500. “I hope to get the amount exchanged today (Thursday). It is harrying to stand in a queue for so long,” he said.

Bankers, meanwhile, said the new announcements about withdrawal and exchange limits will add to the cash crunch.

“There is shortage of money and allowing withdrawal of ₹50,000 per week for traders, ₹25,000 for farmers and ₹2.5 lakh for marriages will surely put extra pressure on currency flow. There is no problem if cash is available but majority of banks are running short of currency,” manager of a national bank in Sector 31, said.

Bankers are also unclear about the proof to be produced for the release of ₹2.5 lakh for weddings planned. “There are no clear instructions in this direction. We are waiting for guidelines though the government said people have to do a self declaration,” RP Sharma, senior official of a bank, said.