The government has announced a higher cash withdrawal limit of Rs 2.5 lakh for wedding expenses
The government announced new measures today to allow farmers and marrying couples to withdraw more money from banks, as scrapping of high-value notes have impacted weddings and the agri sector.
The sudden move last week, which saw 85 per cent of the cash in circulation withdrawn in an effort to curb black money, has led to huge queues forming outside banks as people rush to exchange old notes for new ones.
The government has placed a weekly limit of Rs. 24,000 on withdrawals as banks struggle to cope with a shortage of cash and many ATMs run dry.
But Shaktikanta Das, secretary in the Department of Economic Affairs, said families planning a wedding would now be able to withdraw up to 250,000 rupees in one go.
"Various representations were made to the government," Mr Das told journalists in New Delhi.
"(We) decided that for marriage ceremonies, up to 250,000 rupees will be permitted to be withdrawn from the bank account and it has to be drawn... from the father, mother or the person getting married."
The sudden withdrawal of the two highest denomination notes -- aimed primarily at tackling tax evasion -- has created problems for families planning weddings as most people still use cash for various expenses, even for large transactions.
That however did not stop politician and mining tycoon G Janardhana Reddy from hosting a lavish wedding ceremony for his daughter on Wednesday, taking over a royal palace in Bangalore at a reported cost of Rs. 30 crores according to relatives who spoke on the condition of anonymity.
Agriculture has also been hit hard as farmers struggle to buy seeds and fertiliser with the winter crop-sowing season now under way.
Mr Das said farmers would now be able to withdraw a slightly higher amount -- Rs. 25,000 -- and would be given more time to repay government loans for crop insurance.
"Agriculture is an important component of our society," he said.
"We are at the commencement of rabi (winter crop) season, and therefore to ensure that sowing takes place properly and farmers get smooth supplies like fertilisers, the farmers can withdraw up to 25,000 rupees per week."
There was bad news, however, for anyone who did not fall into those two categories.
Mr Das said the amount an individual can change from old notes to new would be reduced to 2,000 rupees from the current 4,500 rupees, in an attempt to ensure that more people could get hold of at least some cash.