The government has ramped up printing of currency notes and is operating all the four presses 24x7, an official said today amid ATMs running dry in many parts of the country.
Since this week, the presses are minting out Rs 500 and Rs 200 notes without a break to meet an estimated Rs 70,000 crore of currency shortfall in the country, he said.
On an average, the four presses of Security Printing and Minting Corporation of India Limited (SPMCIL) operate for 18-19 hours daily with a 3-4 hour break. But since the time ATMs ran dry due to "unusual spurt in demand" for cash, the presses are operating 24X7, an official told PTI.
Normally a currency printing cycle is of 15 days, meaning thereby the increased number of currencies which are being printed beginning this week would be available only towards the end of this month.
The official said that the printing of currency 24x7 was last done post demonetisation when the printing of new Rs 2,000 notes was fast tracked to meet the liquidity shortage in the market.
The Reserve Bank of India (RBI) had on Tuesday stated that there is sufficient cash in its vaults and currency chests. "Nevertheless, printing of the notes has been ramped up in all the 4 note presses."
The shortage may be felt in some pockets largely due to logistical issues of replenishing ATMs frequently and the recalibration of ATMs being still underway to dispensing smaller sized 200 rupee notes, the RBI had said.
The Finance Ministry earlier this week said there is an unusual spurt in demand in some parts of the country like Andhra Pradesh, Telangana, Karnataka, MP and Bihar. In the first 13 days of the current month, the currency demand went up by Rs 45,000 crore.
Economic Affairs Secretary Subhash Chandra Garg said that the government suspects that Rs 2,000 notes are being hoarded as they are not coming back into the circulation fast enough. To deal with currency shortage, the printing of Rs 500 notes have been increased 5 times.
"The currency printing (will increase) from Rs 500 crore to Rs 2,500 crore per day of Rs 500 note... So in a month, we will be printing about Rs 70,000-Rs 75,000 crore. This should give you assurance that we are geared up to meet the rising demand," he had said.
The Rs 2,000 rupee notes account for about 35 per cent of the Rs 18.43 lakh crore currency in circulation in the country. The printing of this high denomination notes has been halted as it had reached its threshold of Rs 6.70 lakh crore in the system.
The Rs 18.43 lakh crore currency in circulation compares to nearly Rs 17.97 lakh crore currency in circulation before demonetisation of old 500 and 1000 rupee notes on November 8, 2016.