India acts to help farmers hit by black money crackdown
- S&P 500, Nasdaq set records as tech, banks lead
- Texas Instruments (TXN) Tops Q4 EPS by 20c, Issues Solid Q1 Outlook
- Intuitive Surgical (ISRG) Tops Q4 EPS by 10c; $2B Accelerated Share Repurchase
- Seagate Technology (STX) Tops Q2 EPS by 30c
- After-Hours Stock Movers 01/24: (BOBE) (STX) (WDC) Higher; (NEWT) (MRCY) (CA) Lower (more...)
A farmer smokes while sitting on sacks of paddy crops as he waits for customers, one week after the Indian government withdrew the circulation of high denomination banknotes, in Sanand village on the outskirts of Ahmedabad, India, November 15, 2016. REUTE
Find out which companies are about to raise their dividend well before the news hits the Street with StreetInsider.com's Dividend Insider Elite. Sign-up for a FREE trial here.
NEW DELHI (Reuters) - India's government on Thursday announced immediate steps to ease a cash crunch for farmers amid widespread criticism of Prime Minister Narendra Modi's shock decision to withdraw high-value bills in the middle of the sowing and wedding season.
Farmers have been left stranded as traders have no cash to pay for their produce, while millions of Indians lined up outside banks and post offices for the ninth day to exchange old banknotes or withdraw rationed money from their accounts.
Modi dropped a bombshell on Nov. 8 by abolishing 500 and 1,000 rupee notes that accounted for 86 percent of cash in circulation. The move was aimed at cracking down on the shadow economy but has brought India's cash economy to a virtual standstill.
In the latest in a series of ad hoc steps, Modi allowed farmers to withdraw up to 25,000 rupees ($368) a week against their crop loans to ensure that sowing of winter crops "takes place properly", a senior finance ministry official said.
Economic Affairs Secretary Shaktikanta Das also said a time limit for farmers to pay crop insurance premiums has been extended by 15 days.
Many of India's 260 million farmers have no bank accounts and depend on local money lenders to fund sowing, which means those that have to borrow to sow winter crops like wheat or rapeseed could face debt trouble without a good harvest.
The government also slashed the amount of old money people can exchange for new notes to 2,000 rupees - or just under $30 - from a limit of 4,500 rupees.
The move sought to deter huge numbers of people queuing to swap cash repeatedly, some of whom are suspected to be acting on behalf of racketeers trying to launder "black cash" before a Dec. 30 deadline for depositing or swapping old notes.
($1 = 67.8875 Indian rupees)
(Reporting by Nidhi Verma and Neha Dasgupta; Writing by Krishna N. Das; Editing by Douglas Busvine and Michael Perry)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Takata shares rise by daily limit, up 18.2 percent
- U.S. asset managers seek delay on new variation margin rule
- Protesters vow to battle Trump's 'poor decision' to revive pipeline
Create E-mail Alert Related CategoriesReuters
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!