Nepal Information Minister Gokarna Baskota announced the decision to stop the usage of INR 2,000, INR 500 and INR 200 notes in a Cabinet meeting on December 13, 2018.

NRB Spokesperson Narayan Poudel said, these notes will be legal in Nepal only when India issues a Foreign Exchange Management Act (FEMA) notification in accordance with FEMA Act.

India is likely to issue a FEMA notification, enabling its citizens in Nepal and India to possess certain amount of Indian currency.

The decision also comes as part of Nepal’s Government preparations for ‘Visit Nepal 2020‘. The government plans to draw 2 million tourists to Nepal by 2020, a bulk of them from India, alone.

However, this ban will affect middle & low-income Indian tourists and Nepali laborers working in India.

When the Indian Government introduced the new denominations through the demonetization drive in 2016, the Nepal government did not make any declaration on them. The new denominations were being used freely in Nepal for the last two years.

Earlier, a similar ban was introduced in Nepal till 2017, against the usage of INR 500 and INR 1,000 denominations.

However, the ban was lifted after Indian Prime Minister Narendra Modi’s visit to Nepal and its announcement was made official through a notification.

The Reserve Bank of India also formed a task force to ease currency exchange in Nepal for non-Indians possessing the non-functional notes of 500 and 1,000 denominations.

In another scenario, the government also announced serious actions against any writing on currency notes, terming it as a serious offense and subjecting that act to penalty

The post Nepal Bans New High-Value Indian Currency Notes appeared first on Nepali Sansar.

According to PM Oli’s Chief Adviser Bishnu Rimal, Oli is inviting Modi for the ‘wedding procession’ event from Ayodhya to Jankapur as part of the Bibaha Panchami celebrations.

During the Fourth BIMSTEC Summit, both Prime Ministers had planned to make Modi a part of the Bibaha Panchami celebrations and inaugurate the Janakpur-Jayanagar railway track in December 2018.

“Both the leaders had discussed about the plan. The PM will send a letter to Modi inviting him to take part in the wedding procession in Ram-Janaki temple,” said Rimal.

PM Modi will begin with a baraat from Ayodhya, Lord Ram’s kingdom to Janakpur, Sita’s birthplace. Modi will be accompanied by a large number of Indian officials and Bharatiya Janata Party members.

This is Modi’s second visit to Janakpur after his first visit in May 2018.

A political analyst describes Modi’s visit as a means to influence voters in Uttar Pradesh and Bihar, ahead of the Lok Sabha elections.

In the meanwhile, the Janakpur-Jayanagar railway track is almost ready and railways officials have finished conducting a test drive.

The two countries are yet to finalize the modality of railway movement. Nepal prefers wet leasing the railway due to its technical workforce unavailability.

According to an Indian railway official, Indian will recruit and train Nepali staff and then gradually phase out Indian crew. The Janakpur-Jayanagar-Kurtha railway line was built at a cost of Rs 8.8 billion with support from India.

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In a dismaying turn of events, the Indian Government has refused to take back demonetized Indian currency from Nepal and Bhutan.

When the demonetization drive took place on November 8, 2016, it heavily crippled both the countries who had reserves and used Indian currency; leaving behind a dent worth USD 146 million in Nepal’s reservoir.

Similarly, Bhutan is believed to have a reserve of approximately USD 450 million.

In his address to the media, Indian Finance Ministry top official Subhash Chandra Garg said, “I think they (Nepal, Bhutan) have very little INR 500 and INR 1000 currency notes. No final decision yet on exchanging of demonetized notes in Nepal, Bhutan. There are very little chances that we will accept those Indian notes lying there.”

Garg was briefing the media on the Reserve Bank of India’s annual report that declared completion of processing demonetized notes.

On April 5^, 2018, Indian Prime Minister Narendra Modi had tweeted saying, Addressing the Nepalese Parliament PM Oli said, “The Indian demonetization has hurt Nepali nationals. I will raise this in my meetings with Indian leaders and request them to resolve the issue.”

Another post tweeted by the Indian PM read, “India is one of the major suppliers of consumer goods to Nepal and largest trade partner. Keeping in view of the kind of business both nations indulge in, the Indian currency is widely used in Nepal & kept as savings, said Oli.”

However, the Himalayan nation has still not seen any progress and the current situation only dismisses any hope for both Nepal and Bhutan.

Conclusion:
Considering that Nepal and India have extended friendship towards each other and have decided to work collectively for their mutual benefit, we only hope that the issue of demonetized currency is resolved to continue an uninterrupted journey of development by both nations.

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