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Co-op sector in Kerala will be hit by demonetisation: Thomas Issac

Wednesday, Nov 9, 2016,19:22 IST By metrovaartha A A A

Thiruvananthapuram | CPI-M led LDF government in Kerala on Wednesday said demonetisiation of Rs 1000 and Rs 500 notes would create “chaos” in the co-operative sector besides causing difficulty to the common man.

Making a statement in the state assembly on the Centre’s decision, State Finance Minister T M Thomas Issac said the disorder it would create in the co-operative sector that is not under banking regulation, would be huge as there was no directive on how to handle cash in this sector.

“It would affect the common man,” he said.

Centre has also not given any direction on the functioning of treasury, he said, adding, “discussion on this matter is progressing.”

Expressing government’s displeasure on the manner in which the steps were being carried out, Issac said “state government is also for fight against black money, but it should have been done without causing difficulties to common man and in a disciplined manner.”

“The drama witnessed throughout the pronouncement of the new decision is unnecessary,” Issac said.

“The present decision would not only create difficulty to people but also result in setback to the economy,” the minister said. Reduction in the availability of notes till December 30 would aggravate economic recession due to low trade and business, he claimed.

“The draw of state lotteries slated for November 11,12 and 13 has been postponed to next week. Similarly, auction of Chits run by Kerala State Financial Enterprises has also been put on hold,” he informed the House.

On demonetisation, he said the step would help wipe out counterfeit notes, but only a small fraction of the objective could be achieved with regard to unearthing black money.

Urging the people not to get panicky,he said “no one will lose their money. It will take some time to exchange the old notes with new ones,” he said.

The difficulties faced by people would continue till December 30 and the state government would take all possible steps to reduce the suffering, Issac said.

Issac said the situation that prevailed in the country when Rs 500 notes were devalued in 1978 was different. “Now Rs 500 note is with more people and so the present decision will cause difficulty to common man,” he said.

“The state government’s criticism is that fight against black money should have been implemented without causing difficulty to people and affecting the economy,” he said.

This is the first time since 1978 the government has withdrawn money from circulation.

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