The news came out that the neighbouring country of India, Nepal has banned on new Indian high currency denomination of Rs 500 and Rs 1000 on Thursday, Nepal government termed as ‘authorized’ and ‘illegal’
Nepal termed currency as unauthorized
The Nepal Rastra Bank NRC termed the new currency unauthorized and illegal. The two new Rs 500 and Rs 2000 currency notes were issued by Urjit Patel-led Reserve Bank of India (RBI). Narayan Poudel, the spokesperson of NRB said that these notes are not yet legal in Nepal. Poudel further said the currency can only be legal if the India issues a FEMA notification according to the Foreign Exchange Management Act.
But, India is likely to issue a FEMA notification allowing the people in Nepal and India to have a certain amount of Indian currency. A ban was earlier in effect in Nepal till last year against the use of Rs 500 and Rs 1000 currency notes.
When Prime Minister Narendra Modi went to Nepal, the authorities had lifted the ban. Nepal then permitted people to carry Indian rupees of higher denomination up to Rs 25,000. The Reserve bank of India had reportedly formed a task force to make the process of exchange money ease in Nepal for non-Indians who hold the now non-legal tenders of Rs 500 and Rs 2000 notes.
On November 28 Prime Minister Narendra Modi had announced to scrap high-value notes of Rs 500 and Rs 1000. The main motive is to ban old high denomination currency to curb black money and corruption which the opposition is still criticizing while demanding to revoke the demonetization move to the government.
