Thiruvananthapuram: Pessimism deepened in Kerala over the likelihood of an early solution to the cash crunch caused by India’s decision to demonetise 500 and 1,000 rupee notes as currency availability continued to be scarce on Thursday.

Nine days after prime minister Narendra Modi announced demonetisation, Keralites were still standing in queues at bank and ATM counters on Thursday in the hope of exchanging old notes for new ones, or withdrawing money from their own accounts.

Lowering morale further, those who approached banks on Thursday to exchange old notes for new ones, had indelible ink painted on their right index finger. The move is a precautionary measure to prevent customers from exchanging notes more than once.

Chief minister Pinarayi Vijayan sharply criticised Bharatiya Janata Party state president Kummanam Rajasekharan’s allegation that Keralites were finding it difficult to deal with demonetisation because they were “profligate”.

“That is utter nonsense”, said Vijayan, adding even the labourers from outside the state were queuing up to withdraw money for their daily needs.

Kerala finance minister T.M. Thomas Isaac said state finances were certain to take a significant hit owing to the disruption caused to trade and commerce ever since the demonetisation decision was announced. He said the welfare payments by the state would also be affected.

Isaac said steep losses were being incurred by the state lotteries department and the Kerala State Financial Enterprises because of the currency crunch.

Two other sectors that have been badly affected are the jewellery industry and the liquor retail sector.

Jewellers are facing a double blow, with sales having dropped since November 9, and the customs department deciding on an inspection of the books of accounts of jewellers to examine whether some of them had resorted to large-volume sales immediately after the demonetisation was announced.

Liquor retail sales have also fallen sharply at the outlets of the Kerala State Beverages Corporation. The managing director of KSBC, H. Venkatesh said the daily losses of the corporation since the demonetisation announcement was between Rs40 million and Rs50 million (Dh2.16 million and Dh2.71 million).

In the plantation districts of Kerala including Wayanad, Kasaragod, Idukki and Kottayam, land owners are wondering how they would be able to pay wages to workers on Saturday since there is an acute cash shortage in banks, and long queues to withdraw money.