Published: Fri, January 04, 2019
Business | By Eloise Houston

RBI scales down printing of ₹2,000 note to minimum: Finance Ministry official

RBI scales down printing of ₹2,000 note to minimum: Finance Ministry official

The government has stopped printing new Rs 2,000 currency notes in its bid to gradually stop their circulation, ThePrint reported on Thursday.

"There has been no decision regarding 2000 rupee note production recently", Garg tweeted. It has been made a decision to limit the printing of 2,000 currency notes to minimum.

The Rs 2,000 note was introduced in November 2016 after the Narendra Modi-led government demonetised Rs 1,000 and Rs 500 denominations as part of an exercise pitched as a crackdown on black money.

Juxtaposing the data presented in the Lok Sabha with the one provided by RBI in its annual report, the SBI Ecoflash report said, "we observe" that the value of small denomination currency in circulation up to March 2017 was Rs 3,501 billion.

"Printing of notes is planned as per the projected requirement".

Now, Subhash Chandra Garg, Secretary, Department of Economic Affairs, Ministry of Finance clarified that no such decision has been taken regarding the printing of Rs 2000 notes recently. The remaining was in the lower denominations. "The printing of 2,000 rupee notes has been substantially reduced". However, the cut in circulation doesn't translate into the note being deemed invalid.

Many Indian cities had reported a massive cash shortage last April which was believed to be due to hoarding ahead of state elections and in the aftermath of the PNB-Nirav Modi bank fraud.

There have been indications of phasing out the Rs 2,000 note.

The old 500/1,000 bank notes that were scrapped in November 2016 accounted for around 86 percent of the total currency in circulation at that time. In March 2018, it was recorded at 37.3 per cent, a fall of almost 13 percentage points from 50.2 per cent in March 2017.

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