Kathmandu. Nepal Rastra Bank has formally permitted the authorized use of Indian notes of Rs 200 and Rs 500 denominations. The central financial institution has additionally formally carried out the use and change of these notes after finishing the mandatory procedural preparations.
According to the central financial institution, Indian notes as much as Rs 500 issued after November 09, 2016 can now be delivered to Nepal or taken to India. Transactions may be accomplished with Indian notes as much as Rs 500 in Nepali market and banks may also change these notes simply.
On Thursday, Nepal Rastra Bank issued directions implementing the choice of the Government of Nepal to permit the use of Indian forex notes. However, the use of outdated Indian notes of Rs 500 and Rs 1,000 issued earlier than November 2016 will nonetheless be restricted.
Similarly, Indian notes of Rs 2,000 presently in circulation won’t be allowed to be introduced into Nepal, carried or possessed. The central financial institution has additionally clarified that bringing Indian forex to Nepal or taking it out of Nepal from any nation aside from India won’t be allowed.
It is noteworthy that the Indian authorities had demonetized outdated notes of Rs 500 and Rs 1,000 on 08 November 2016, which had an influence on Nepal as effectively.
Till that point, Indian notes of massive denominations had been broadly used in Nepal. More than Rs 7 crore had been deposited in Nepal’s banking system in the shape of Indian notes of Rs 500 and Rs 1,000.
Nepal took initiative a number of occasions to change these notes, however the Indian authorities didn’t enable it. After this, the use of massive denomination Indian notes was banned in Nepal.
Nepal Rastra Bank spokesperson Guru Paudel stated that now the system has been made such that Nepali banks will have the ability to take these notes from widespread residents and ship them to Nepal Rastra Bank and the central financial institution will have the ability to deposit them in its account in the Reserve Bank of India (RBI). Following this association, use of Indian notes of bigger denominations has been allowed.
Last 12 months, the Reserve Bank of India (RBI) amended the Foreign Exchange Management Rules-2015 to permit motion of massive denomination Indian notes between Nepal and India.
Under the brand new guidelines, Indian notes as much as Rs 100 may be moved in any amount from India to Nepal or from Nepal to India and there isn’t any restrict on this.
At the identical time, in case of notes of denomination greater than Rs 100, a most of Rs 25,000 has been allowed to be introduced from India to Nepal or from Nepal to India.
After this, the Government of Nepal had additionally permitted the use of massive denomination Indian notes, however it was not carried out as a consequence of lack of procedural preparations.
Now in any case the mandatory processes are accomplished, Nepal Rastra Bank has formally carried out it from Thursday.