Demonetisation and industrial woes

Cash-crunch hits unorganised sectors in Mandya, Ramanagaram

A bank in Ramanagaram has set up a notice refusing to exchange demonetised notes of Rs. 500 and Rs. 1,000 belonging to non-account holders.  

The scarcity of valid currency notes, following the demonetisation of Rs. 500 and Rs.1,000 notes, has left a tell-tale impact on production activities in the unorganised sectors in Mandya and Ramanagaram districts.

Whilst several ‘aalemanes’ (traditional jaggery producing units) in Mandya district have temporarily suspended production owing to unavailability of currency, silk reelers in Ramanagaram district are struggling to get fresh work orders and run their business.

The demonetisation of two high-value notes has also had an adverse effect on business activities linked with poultry, bricks manufacturing units and concrete pipes-hollow brick manufacturers, officials at the District Industries Centre (DIC) in both the districts said.

7,000 industries

Mandya district has around 6,000 small scale industrial units, while Ramanagaram has over 1,700 such production units. Of the workforce at these units, at least 20 per cent are daily wagers. All 530 registered ‘aalemanes’ and 227 poultry farms hire the employees on daily-wage system. The cash-crunch has been slowing down business activities at these units with owners failing to arrange cash to pay labourers, the officials said.

Pavement vendors, flower and fruit merchants, vegetable sellers and other vendors at both districts say their business has come down by at least 60 per cent owing to the demonetisation.

“Most of the customers bring Rs. 1,000 or Rs. 500 notes and therefore we are incurring loss,” said Sowmya Mahadeva, a flower seller in Mandya.

Spot payment

The daily-wagers who demand on-the-spot payment are not ready to receive demonetised money. A majority of the labourers are running from bank to bank to exchange the invalid currency, Thumbenahalli Shivakumar, Karnataka Rajya Raitha Sangha leader in Ramanagaram, told The Hindu.

450 banks

While Ramanagaram district – from all four taluks – has 172 branches of various nationalised and private banks, nearly 280 branches of various banks are functioning in all seven taluks in Mandya district.

Meanwhile, some banks in Ramanagaram on Monday reportedly refused to exchange old notes or issue valid currency notes to non-account holders.

The supply of currency notes in Ramanagaram is short and the crisis is expected to be toned-down in some days, L.L. Ramesh, Senior Officer, Lead Bank of Ramanagaram (Corporation Bank), told The Hindu.

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Printable version | Dec 7, 2021 12:33:45 PM |

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