Use of banned notes at selected government facilities will end today, some extensions likely
The government's concessions for accepting the now banned 500 and 1,000 rupee notes at petrol pumps, hospitals and several government facilities ends at midnight tonight, and sources said some exemptions will be extended in a calibrated manner.
The government is expected to make an announcement this evening.
Prime Minister Narendra Modi's sudden announcement a fortnight ago banning high value notes in an attempt to curb black or untaxed money, took out 86 per cent money in circulation resulting in a massive cash crunch.
The government has rushed to print new currency to replace the old notes and re-calibrate ATMs to dispense the bigger new notes, and PM Modi has sought 50 days to ease the situation. But as people have stood for days in exacting queues at banks and ATMs for rationed new notes, the government and the central bank have also announced almost daily concessions on the use of new notes and on cash withdrawals.
Former Prime Minister Manmohan Singh called the government's implementation of the demonetisation a "monumental management failure" and said the "Change of rules every day reflects poorly on the PM's office and the Reserve Bank of India."
The concessions offered till midnight today for the use of old notes are:
- Payments in government hospitals for medical treatment
- Use in all pharmacies for buying medicines with doctor's prescription
- At railway ticketing counters, bus ticket counters of government or public sector undertakings and airline counters at airports for purchase of tickets
- Purchases at consumer cooperative stores operated under authorisation of central or state governments with identity proof (Safal, Mother Dairy)
- Purchases at milk booths under central or state governments
- Purchase of petrol, diesel and gas at stations of state-run oil companies
- Payments at crematoria and burial grounds
- Use at international airports for arriving and departing passengers up to Rs 5,000
- Foreign tourists to exchange foreign currency up to Rs 5,000
- Purchase of LPG gas cylinders
- Payments towards on-board catering during travel by rail
- Purchase of tickets for suburban and metro rail travel
- Purchase of entry tickets monument maintained by the Archaeological Survey of India
- Payments towards fees, charges, taxes or penalties, payable to central or state governments including municipal and local bodies
- Payments towards utility charges including water and electricity, but no advance payments
- Payments towards court fees
- Payments towards purchase of seeds from designated state-run outlets, but only Rs 500 notes