How demonetisation is affecting the aam aadmi

'We have money (in the bank), yet we cannot eat.'

'I may not get much affected (by the Rs 2,000 limit) but what about those who lead a hand-to-mouth existence?' 

Prasanna D Zore/Rediff.com reports on how ordinary people are coping with the sudden crisis in their lives.

On the day the government announced a reduction in exchange limit of just Rs 2,000 instead of Rs 4,500, Rediff.com asked the aam aadmi how the de-legalisation has affected their daily business and routine life.

The common refrain was: Shortage of loose change in lieu of the Rs 2,000 note has impacted everyone severely. Business was down anywhere between 50 per cent and 80 per cent.

Here's what different people had to say of the cash crunch they have been facing for more than a week now.

'Have bought fruits on credit, will repay after selling them'

Rupaye main bara aana fark pada hai (my business is down 75 per cent)," says Dulare Gupta, whose brother purchases fruits from the Vashi market, the hub of all agricultural trade, on the outskirts of Mumbai, and sells them in the market near Malad railway station, a north Mumbai suburb.

Gupta's business has suffered mostly because his buyers, as is their wont, still bring Rs 500 and Rs 1,000 notes, no more legal tender after November 8, in the hope that they will be able to transfer their trouble of exchanging such notes after waiting in long queues in banks, to the vegetable and fruit vendors in the market.

Gupta says his brother faces the same difficulties as his buyers face: nobody's taking Rs 500 and Rs 1,000 notes anymore and there aren't enough of these denominations with him or his brother to pay the trader at the Vashi market.

'Customers are willing to buy but they flash a Rs 500 note'

Like Gupta, Dinesh Bhagat, a vegetable vendor, also faces the same issue: most customers coming with Rs 500 and Rs 1,000 notes which he doesn't accept and the same not being accepted by those from whom he purchases the vegetables at Vashi market.

"Some people do bring Rs 100 notes but then that has reduced our daily business," he says.

"Customers do want to buy vegetable worth Rs 200-300 but then they flash Rs 500 notes, which we don't accept," he adds.

Thankfully, he says, he gets vegetables on credit and will repay his creditor once he deposits his earnings in a bank.

'I may not be affected but what about those who live a hand-to-mouth existence?'

"Rs 2000 is not enough to last a full week, is it?" asks Vandana Podar, a retired municipal school teacher, who is not happy with the government's move to cut the Rs 4500 per day exchange limit to Rs 2,000 from November 18.

She lists her expenditures that, she says, would easily gobble up the Rs 2,000 that she is allowed to exchange now by the government, even as she says how expensive vegetables have become post the de-legalisation.

"We have money (in the bank), but yet we cannot eat," she says.

"I may not get much affected (by the Rs 2,000 limit) but what about those who lead a hand-to-mouth existence?" she asks.

'We are dying of hunger'

A vegetable vendor in his late 50s, Suresh Yadav says he has lost 75 per cent of his business after the government decided to weed out Rs 500 and Rs 1,000 notes from circulation.

Yadav, despite his age, goes to the Vashi and Dadar markets, all by himself to make his purchases. "The traders at these markets tell us to pay them only after we earn money," he says.

'Neither traders nor we accept Rs 500 notes'

This, in a way, explains the vice-like grip experienced by those whose businesses depend on easy cash flow.

Yadav, who identifies himself by his last name and who often goes to the Vashi market to make his purchases, says that fruits have begun rotting at the markets for want of customers with currency notes that is legal tender.

"And all this has happened because (the government) has stopped the circulation of Rs 500 and Rs 1,000 notes," he says.

Yadav has lost 80 per cent of his business from November 8 and is among those severely critical of the move.

He says some traders have jacked up the prices of fruits even as they accept old notes.

Yadav complains that without much cash in his hand, he does not have enough rations at home. "Rationwala bhi naya note mangta hai (even ration shops ask for new notes). We have to stand in queue for 4-5 hours to get Rs 2,000 and that isn't enough to buy rations," he says.

Unlike others, Yadav doesn't get his wares on credit and "we have to pay those from whom we buy the fruits," he says, explaining why what he earns is not enough to buy rations for his home.

Expressing concern that the Vashi market might close if the shortage of currency worsens, Yadav says, "If we don't buy as much as we used to buy from them earlier, will they eat these fruits?"

'Some days I don't even sell a single dress'

After the ban on Rs 500 and Rs 1,000 notes was effected, there have been some days when Surendra Yadav, a businessman who sells dresses for small children, has not sold even one piece.

"Business has dropped to Rs 2,000/1,000 from Rs 25,000 to 30,000 that I used to earn earlier," he says.

Like the fruit sellers and vegetable vendors, Yadav too faces the same problem. "Most people come with notes that are no more legal tender, which I accept because I have time till December 30 to deposit them," he says.

"But then I don't have enough change to give them back," he says, because of which he is losing out on his daily earnings.

On the other hand, his problems are compounded because the traders from whom he purchases the dresses have stopped accepting the old Rs 500 and Rs 1,000 notes.

"I am selling only what is left with me," says Yadav.

Interestingly, Yadav bears his pain stoically and feels that the decision to ban the high-denomination currency is a good one for the poor in the long run. Ask him how, and he says, "Bhale hamare dhandhe pe asar pada ho, lekin sahi hua hai (so what if it has affected our business, it is still a good decision)."

He is confident that Prime Minister Narendra Modi's demonetisation move will help the next generation and also put an end to black money.

He concedes that rural India is going hungry as this move has stopped the flow of cash into their hands but adds, "Let us see what more steps the government takes to stop corruption and black money."

"Saal bhar baad pure desh main khush-hali chha jayegi (the best impact of demonetisation will be felt after a year and the nation will benefit from it)," he says.

'How do you think we can manage all this?'

"I haven't been doing any business since the last four days. From where will I give loose change if customers give me Rs 500 or Rs 1,000 note?" asks Makhdoom Sheikh, a dress seller.

Sheikh had once, since November 8, exchanged his old notes for new ones which, he says, he exhausted soon enough on household expenses. "How much change can we give customers? Even if the customer gives us the new Rs 2,000 note, from where will I give them the balance amount?" he asks.

First they said we could exchange only Rs 4,000, then they increased it to Rs 4,500 and now they have again reduced it to Rs 2,000; deposits, withdrawal and ATM lines are too big. How do you think we can manage all this?" asks Sheikh.

Sheikh believes that it won't be before March for the circulation of enough cash in the system to resume for people like him to go back to doing normal business.

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