Once a prosperous port town, Lakhpat, 135 km from district headquarters Bhuj, is now a fishing village of around 500 people. A high, red sandstone fort-wall protects the village. And many locals joke that the wall has stopped demonetisation from entering their dusty streets. One month on, the locals in this last village on India’s western border in Gujarat’s Kutch district, are still sustaining on old, scrapped notes.
Every other inhabitant has heard of demonetisation. Few have seen the new notes of Rs 2,000 and Rs 500. For them, the old currencies do just fine.
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“It’s a 50-year-old shop, and the name of Thakkar Damodar Narayanji firm stands for something,” says Hitesh Thakkar, a provision store owner in Mandavi Bazar in Lakhpat when asked what he is doing in the absence of valid currency. “This is a village of the poor, and if somebody comes with an old Rs 500 note to buy ration, I cannot say no to him.”
A Commerce graduate, Thakkar says demonetisation has not affected his business. “Since ours is an old shop, we obviously sell on credit. More people have purchased on credit after November 8, but I have not let that to effect my customers or my business.”
Showing three scrapped Rs 500 notes, farmer Deepak Thakkar, 36, who owns a tractor-powered thrasher, says, “A farmer who had hired my thrasher gave me these notes this morning. Could I have said no? Are these black money? It has rained in our village this monsoon after three years and farmers have to make most of it. My three brothers and I have five bank accounts and have nearly Rs1.5 lakh in bank. I will deposit these notes in one of those accounts.”
Deepak and his brothers jointly own 12 acres, as also ‘Zeel Cold Drinks’, the largest general store in Lakhpat. “Business at the store is down by nearly 75 per cent. I have already sold ration and other items worth around Rs 60,000 on credit in the last one month.”
Fishermen, who form the majority, also have no way to escape the old notes. Jumma Sodha, the village fish trader, says the two companies to whom he sells fish in Gandhidham, nearly 200 km away, pay in old notes. “I have to pay fishermen every fortnight, and require between Rs 2 lakh and Rs 3 lakh. The fishermen do not want to accept old notes, but they also realise there is no short-term solution. They have accepted two installments,” he says.
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Banks say there is little they can do. “Our daily cash demand is Rs 10 lakh. We get Rs 3 lakh to Rs 5 lakh every second day. So we have no option but to ration (disbursement),” says Dahyalal Patel, manager of Dena Gujarat Gramin Bank (DGGB) in Ghaduli, 20 km from Lakhpat. “We are giving Rs 4,000 to each account holder – we can disburse cash about four days after one comes for withdrawal.” Patel says that the bank clerk travels to Bhuj by bus or cab to get cash. The Ghaduli branch caters to banking needs of 25 villages, including Lakhpat. It has 6,500 accounts.
Dena Bank’s Dayapur branch manager Shankarlal Meena says he gets Rs15 lakh every third day but has 1,200 accounts to take care of. “We cannot give more than Rs 6,000 per person per week. Out ATM is lying idle for many days,” says Meena.