The Telangana government on Tuesday decided to make a part of the payment of salaries to its employees in cash, in view of cash crunch due to demonetisation of high value currency notes.

The Finance Department has issued the orders for payment of Rs 10,000 in cash to each employee and pensioner towards their salaries and pensions for November.

It directed nationalised and agency banks to make the part payment in cash from the salary and pension accounts. The banks were directed to make separate counters for employees and if necessary function till late hours.

The Telangana Non-Gazetted Officers' Union had requested the government to allow employees and pensioners to draw the entire amount in cash in view of the difficulties faced by them due to demonetisation of Rs 1,000 and Rs 500 notes.

The state government every month pays Rs 2,500 crore as salaries and pensions.

There were apprehensions that the state may impose a cut in salaries due to fall in revenues following demonetisation. However, the government has stated that the salaries will be paid in full.

Chief Minister K Chandrasekhar Rao on Monday said that the state was suffering revenue loss due to demonetisation.

 He said if the current trend continues, the state may suffer revenue loss of Rs 7,500 crore during the current financial year.