Telangana Chief Minister K. Chandrasekhar Rao will support demonetisation both within and outside Parliament despite his “deep unhappiness” with the move as he believes the move will have long term impact on the economy.
KCR met the PM in New Delhi on Saturday evening and made a presentation on the impact of the demonetisation on the states’ finances. He is perhaps the first Chief Minister to have hadan interaction with the PM over demonetisation.
Sources in KCR’s office told The Sunday Guardian that KCR would submit a detailed note on the economic and political fallout following the withdrawal of big notes to the PM, who is also expected to hold similar consultations with other CMs after the winter session of Parliament.
It is believed the PM called up KCR after an unhappy Telangana CM deputed his Telangana Rashtra Samithi’s leader in Lok Sabha, A.P. Jithender Reddy to meet the PM in Parliament and seek an appointment to discuss the post-demonetisation situation.
The PM’s assurance to KCR that he was welcome to discuss the issue by the weekend was the reason KCR did not go ahead with his initial plan to join the anti-demonetisation protest along with West Bengal CM Mamata Banerjee in New Delhi on Thursday.
KCR abstained from the planned protest despite Banerjee calling him up personally on Tuesday.
KCR, following PM Modi’s assurance for a meeting, held a meeting with senior officials involved with finances to chalk out strategies on how to address people’s woes due to the currency crunch.
Chief secretary Rajiv Sharma, special chief secretary S. Pradip Chandra, principal secretaries M.G. Gopal, S.K. Joshi, S. Narsing Rao and secretaries Smitha Sabharwal and Naveen Mittal were present in the meeting.
KCR was expected to make the following suggestions to the PM: Treating all un-deposited big currency notes with individuals and businessmen as just “unaccounted money”.
KCR was expected to suggest increasing the limit of Rs 2.50 lakh cash deposit and the time limit beyond 30 December in the interests of the public.
The CM was to further urge PM Modi to ensure that small and medium entrepreneurs and traders were not subjected to harassment either from the banks or the tax officials on the ground that the money deposited by them exceeded the limit. Some more exemptions should be given to the unorganised traders and street vendors, KCR has told the Prime Minister.
KCR was also supposed to request the PM for more help or grants to Telangana in the wake of the losses suffered due to demonetisation.
The CM has estimated that the overall loss to the state exchequer in the last six months of the current financial year would be around Rs 12,000 crore, a dip by 60% in the average revenues.
This is due to the sharp decline in the revenue collections of earning departments like stamps and registration, excise and prohibition, commercial taxes and endowments.
The collection in these departments in the last 10 days has gone down by 60% to 70%.
If this situation continues, the government will not be in a position to pay salaries to its staff, leave alone meeting its Rs 46,000 crore annual revenue target.
KCR wa supposed to ask the PM to allocate at least 42% of the funds the Centre would be raising from the Reserve Bank of India after 31 December.
As per the Chief Minister, sources said, the RBI would be transferring around Rs 4 lakh crore to the Centre when it prints new notes, replacing the un-deposited black money in the banks.