Nepal’s Prime Minister Prachanda Seeks Swap of Banned Indian Notes in Nepal
Nepal’s Prime Minister Prachanda has reached out to India’s Prime Minister Narendra Modi to arrange for the exchange of banned high denomination Indian bank notes held by Nepalese citizens. During their brief phone conversation, Prachanda informed Modi that Nepalese people have a significant stock of 500 and 1,000 rupee notes that have been withdrawn from circulation.
Many Nepalese, who work as daily-wage laborers in India, visit the neighboring country for medical treatment or to purchase daily essentials. These individuals are said to be holding a substantial amount of scrapped Indian bank notes. Additionally, those who travel to India as pilgrims and those involved in cross-border trade are also said to have a large stock of now-useless Indian bank notes.
According to the Federation of Nepalese Chambers of Commerce and Industry, some of these individuals may lose their entire savings if the now-obsolete notes are not replaced with legal currency. Prachanda, in a statement posted on his personal website, urged India to make arrangements for the exchange of these notes in Nepal.
In response, Modi promised to resolve the issue immediately and asked the Finance Minister to hold talks with the Nepalese counterpart. The Nepal Rastra Bank (NRB), the central bank, also banned the use of these bank notes in Nepal from last Wednesday.
The NRB reported that there are IRs 33.6 million in the denominations of 500 and 1,000 rupees within the financial system in Nepal, including cash stored at banks, financial institutions, and the central bank. However, the actual stock of banned Indian bank notes is expected to be much higher, as Nepalese were previously allowed to carry Indian 500 and 1,000-rupee bank notes worth up to IRs 25,000.
The Ministry of Finance wrote to the Indian Finance Ministry on Thursday requesting arrangements for the exchange of banned Indian notes in Nepal. The NRB also wrote to the Reserve Bank of India, seeking exchange facilities for Nepalese holding banned Indian notes.
Published: November 15, 2016, 02:37 pm IST
Reference : https://www.thehindu.com/news/international/Demonetisation-Prachanda-dials-Modi-seeks-help/article16448474.ece
