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State polls caused Rs.60,000 crore extra cash around: Rajan | Canindia News

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State polls caused Rs.60,000 crore extra cash around: Rajan

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CanIndia New Wire Service 0 comments

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Mumbai, April 5 (IANS) There is a massive current surge in cash circulation coinciding with ongoing state elections, with money in people’s hands going by over Rs.60,000 crore, Reserve Bank of India (RBI) Governor Raghuram Rajan said on Tuesday.

“Around election time, cash with the public does normally increase… You can guess as to reasons why, we can also guess,” Rajan told reporters here after announcing his first bi-monthly monetary policy review of this fiscal that effected a 25 basis points cut in the RBI’s key interest rate.

“You see some (cash surge) not just in the state going to elections, but also in the neighbouring states. There is something… we need to understand it better,” Rajan said, adding cash in people’s hands has currently gone up by more than Rs.60,000 crore, which is “not normal”.

Elections are currently underway in Assam, West Bengal, Kerala, Tamil Nadu and the union territory of Puducherry. Of these, Assam and West Bengal held their first phase of polling on Monday.

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