Rs 2000 notes printing stopped, remains valid
Posted on: 04/Jan/2019 3:26:10 PM
Printing of Rs 2000 notes by the RBI has got stopped after 2 years of its introduction. This is being stopped with the aim of bringing down the circulation of such high denomination currency.
This stoppage of Rs 2000 note printing doesn’t indicate in any kind that the currency is invalid. This initiative is purely to reduce the usage of the currency which is the highest of denominations of all INR currencies. This decision follows government’s suspicion that this currency is largely in use for tax evasion, hoarding and money laundering.
The story of 8th November 2016
It was on this day, the 8th of November 2016 that the Prime Minister Narendra Modi had withdrawn the earlier notes of values Rs 1000 and Rs 500 towards curbing black money. Following this, Rs 2000 notes were introduced afresh to meet the currency shortage.
The RBI reports as of March 2018 states that there were Rs 2000 notes of Rs 6.73 lakh crore worth being in circulation in the country. This count accounts to a total of 37 percent of the country’s overall currency circulation. Coming on to the Rs 500 currency notes, they account to 43 percent of the overall currency circulation. And the rest are of lower denominations.
As the Rs 2000 notes were introduced, there were a lot of criticisms stating that this initiative will comfort the hoarders and tax evaders to store lump sum money.
Back in April 2017, there was severe cash shortage in various parts of the country. The reason for shortage is blamed to be the bulky amount reserved as cash prior to state elections.
In the same period, the income tax department had also seized pile up of Rs 2000 notes. The initiative to weed out Rs 1000 notes and introduce Rs 2000 was looked upon by many economists including the MD of Kotak Mahindra, Uday Kotak.
