Government to Speed up Production of Rs 500 notes

"Overall there is more than adequate currency in circulation and also available with the Banks. The temporary shortage caused by 'sudden and unusual increase' (in demand) in some areas is being tackled quickly," he said in a tweet.

To meet the "unusual" currency demand in the country, the government has decided to increase printing of Rs 500 notes by five times, Economic Affairs Secretary Subhash Chandra Garg said here on Tuesday.

"We have taken steps to increase the supply of currency in case the demand was to go up further. To give you an example, Rs 500 notes -- we print about 500 crore of notes per day. We have taken steps to raise this production five times," Garg said at a press meet called to calm fears after reports of currency shortages emerged from several parts of the country.

The Reserve Bank said in a notification that there is no currency shortage and clarified that there is sufficient cash in the central bank's vaults and currency chests. RBI also said that printing of the notes had been ramped up in all four note presses.

Minister of State for Finance Shiv Pratap Shukla said the government had formed a committee to address the problem of currency shortage in certain states and the issue would be resolved in next 2-3 days.

Income tax officials have been roped in to probe the surge in cash withdrawals that is believed to have contributed to ATMs running out of cash, a senior official said.