21/11/2016 2:31 PM IST | Updated 25/11/2016 8:36 AM IST

Demonetisation Has Seriously Hurt The Farmers And Daily Wage Workers Of Odisha

Farmers and rural daily wage labourers in Odisha have been left stranded due to the huge scarcity of lower denomination notes.

By Basudev Mahapatra*, Kandhamal, Odisha

The sowing season for the winter (Ravi) crop is in full swing, but Nabarathi Kuanr, 60, of Sudrukumpa village of Kandhamal district in Odisha has no option but to watch helplessly from the sidelines. The reason? He cannot get seeds and fertilisers from the government and cooperatives because of the scarcity of lower denomination notes after the Indian government on 8 November declared that ₹500 and ₹1,000 banknotes have been demonetised. (This was modified by the government to give farmers relief by letting them use old currency notes to buy seeds.)

The banks ask the farmers for documents like Aadhaar or PAN card, which most of the tribal and poor farmers of Kandhamal district do not have. Panchanan Mishra, development activist

"They say the situation will improve in a few days," Kuanr told "But is the soil condition going to be the same and conducive for sowing then?"

The situation with farmers who have sold their Kharif (autumn) harvest is all the more dire because they all have invalid ₹500 and ₹1,000 notes in cash — these are no longer accepted by private businesses and even at government-run facilities.

"They are not able to avail themselves of the limited exchange facility because banks ask farmers for documents like Aadhaar or PAN card, which most of the tribal and poor farmers of Kandhamal district do not have," said Panchanan Mishra, a development activist of Phulbani who works for the welfare of farmers in Kandhamal district.

Hapless farmers

Local cooperative societies and the district cooperative banks do not accept the old currency notes. And many of the farmers do not have accounts with nationalised banks to deposit the cash available with them. As a result, farmers are in a real quandary, Mishra told What is compounding matters is that already middlemen are trying to take advantage of the farmers' helplessness.

"Because farmers living in remote villages are finding it extremely difficult to walk long distances to the bank in order to exchange their higher denomination notes, some middlemen take their notes at a value discounted by 20% to 30%," said Udit Sahu, in-charge of a Customer Service Point in Dungriput village of Koraput district.

Farmers and poor people living in the rural Odisha and tribal hinterland have been severely affected by the demonetisation drive because coming to the banks and getting their cash is a huge challenge for them.

Small businesses in rural Odisha are also in distress because consumers do not have the capacity to purchase even essential items due to non-availability of the appropriate currency notes. "Transactions have dropped by more than 60% and it has been difficult to make our livelihood," Kalia Behera of Bhanjanagar village in the south Odisha district of Ganjam told

No daily bread

The situation is even worse for people who live on daily wages. Demonetisation has badly hit Basanti Marandi, who hails from the northern district of Mayurbhanj in Odisha and makes a living as a daily wage labourer.

"I don't know if I will get work today because labour contractors haven't been hiring as much since the government banned the old notes. Even if I go to work, getting paid is uncertain because the contractors are short of ₹100 notes to pay wages," said Basanti while waiting for someone to hire her for a day's work.

We can't get enough ₹100 notes, and the labourers are not interested in ₹2,000 notes because it means standing in a queue for a day to break the money. Brundaban Dalbehera, real estate developer

At least 3,000 labourers gathered at Bhubaneswar's Nayapali labour point face a similarly uncertain fate. They have migrated from various parts of rural Odisha to make their now-threatened livelihood — their problems are echo the difficulties faced by thousands of others across the state.

"Only half of us get work these days because there are only selected takers and the demand of labourers has fallen due to restricted availability of lower denomination notes," Maheswar Pradhan, another labourer hailing from Bhanjanagar village of the southern district of Ganjam, told

Most construction work has slowed since announcement of demonetisation. Real estate and infrastructure builders and contractors are unable to accommodate more daily wage labourers in their projects because of the scarcity of lower denomination currencies.

"Making payments to labourers is a big issue. We can't get enough ₹100 notes, and the labourers are not interested in ₹2,000 notes because it means standing in a queue for a day to break the money into smaller notes," says Brundaban Dalbehera, a Bhubaneswar-based real estate developer.

"If the government claims that the intent behind the demonetisation drive is good, then they should have prepared better to manage the repercussions," said Ashok Parida, a development activist from Kandhamal.

Basudev Mahapatra is a Bhubaneswar-based journalist.

This article was first published on, a public-interest communications platform focused on rural India.

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