Narendra Modi, the Prime Minister of India, caught the nation off-guard when he announced on November 9 that 500 and 1000 rupee notes would be demonetized from November 10 and the Reserve Bank of India (RBI) would be issuing new 500 rupee notes and 2000 rupee notes in the days to come. Citizens were advised to exchange their 500 and 1000 rupee notes with identify proof to their banks and obtain new money.

PM Modi made the announcement as part of his agenda to crackdown on black money, counterfeit notes and terror financing in the country. However the crackdown has had a major impact on day to day operations in the country and Goa’s casino industry has also suffered due to the sudden demonetization.

Casino operators in Goa have complained that business has been very dull since PM Modi’s announcement as the casino does not have liquid cash to pay their patrons. This is because the Modi government and the RBI have imposed withdrawal limits of just 2,000 rupees per day for the next couple of weeks as banks are facing difficulties in obtaining sufficient amounts of the new currency.

The government has not banned online transactions as the crackdown only targets liquid cash in the form of 500 and 1000 rupee notes. However casino operators have complained that online transactions at the casino do not really work in this scenario because if a player deposits 10,000 rupees via an online transactions, loses 2000 at the casino and wants to cash out the remaining 8000, the casino does not have the cash to reimburse the player. As a result, players are not very keen to visit Goa’s casinos right now and as a result a number of casinos have been forced to shutdown for the time being.

In a statement, a casino operator who wished to be anonymous said “The entire exercise is based on the presumption that all cash is ‘blackmoney’ and all online transaction is ‘whitemoney’. This is untrue. We have ‘explained-money’ in the books for trading on day-to-day basis to run the business (employee salary and operational costs), but I am unable to do so. All our businesses have closed-down. We have no money (in cash) to pay people and vice versa.”

Due to the limited withdrawals placed on ATMs in the country, people are using their withdrawals on basic necessities like food and transport, which is one of the reasons why the visitors to Goa’s casinos have fallen. Goa is currently in the middle of its tourism season and the tourist industry is also facing hardships due to the demonetization policy.

PM Modi has given citizens time till December 30 to return their 500 and 1000 denominations. ATM withdrawals for the week is fixed at 10 thousand rupees per card and there is no indication as of now as to when the limitation will be lifted.