Nepal ban on high denomination currency will help India

By: |
New Delhi | December 14, 2018 7:17 PM

To check money laundering, hoarding, counterfeiting and misuse of high denomination currency from India, the government of Nepal has announced the ban of currency notes of Rs 2,000, Rs 500 and Rs 200 denominations.

Nepal has announced the ban of currency notes of Rs 2,000, Rs 500 and Rs 200 denominations. (Representational Image/IE)

To check money laundering, hoarding, counterfeiting and misuse of high denomination currency from India, the government of Nepal has announced the ban of currency notes of Rs 2,000, Rs 500 and Rs 200 denominations.

While the Indian government has yet to share their view on this, a senior officer speaking on condition of anonymity said, “The banning of such denominations in a way is a positive step as it will help India to ensure that terrorists are not able to use high denomination notes for their activities as well as control counterfeiting. The higher denominations are easy to hoard too and the ban will check this too.”

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When the Indian government introduced notes of Rs 2,000, Rs 500 and Rs 200 denominations after demonetisation in 2016, the Himalayan nation had assured India that they would use new technology to check counterfeit.

Quoting their Minister for Information and Communications Gokul Prasad Baskota, media reports from Kathmandu have said that the government has asked the people not to keep or carry Indian bank notes higher than Rs 100 denomination as it has not legalised the higher denominations.

Such a ban is expected to impact the blue collar workers on both sides as their remuneration is often in higher denominations as well as tourists from India visiting Nepal. The higher denomination currency has been in use in the Himalayan nation for nearly two years.

Though the Indian currency is not a legal tender in Nepal, it has been used and is available in Nepal, and before demonetisation the Nepali travellers were free to carry Rs 500 notes as well as Rs 1000 notes.

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In 2016, the government of Nepal was keen on banning the Indian currency completely’, and the Gorkha pensioners as well as blue collar workers were impacted from that country’s southern border areas.

Post-demonetisation, Nepal government had reached out to India, for setting up facilities for exchanging old notes. But there was no clear indication from the Himalayan neighbour of how much Indian currency is in circulation there.

It may be recalled that New Delhi had also expressed concern that there could be a fake Indian currency note networks, which could be used for getting in the fake notes inside India.

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