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No proposal to withdraw new Rs 2,000 notes, says FM Arun Jaitley

The Rs 2,000 banknotes were introduced along with new Rs 500 currency following the withdrawal of old Rs 500 and Rs 1,000 notes from November 9, 2016.

twitter-logoPTI | March 17, 2017 | Updated 14:37 IST
FM Arun Jaitley
FM Arun Jaitley

Amid buzz that the government may resort to demonetisation again after four months, Finance Minister Arun Jaitley said on Friday there is no proposal to withdraw the Rs 2,000 notes that were introduced post demonetisation.

The Rs 2,000 banknotes were introduced along with new Rs 500 currency following the withdrawal of old Rs 500 and Rs 1,000 notes from November 9, 2016.

"There is no proposal to withdraw the Rs 2,000 denomination banknote," the minister said in a written reply in the Lok Sabha.

Jaitley further said the Rs 500 and Rs 1,000 notes returned to currency chests of the RBI amounted to Rs 12.44 lakh crore (as on December 10, 2016).

The data obtained in this regard would need to be reconciled with the physical cash balances to eliminate counterfeit notes, accounting errors and possible double counts after which only the final figures will be arrived at, he said.

He added that as on March 3, 2017 the currency in circulation was Rs 12 lakh crore and as on January 27, it was Rs 9.921 lakh crore.

Jaitley said the cash recall seeks to create a new "normal" wherein the GDP will be bigger, cleaner and real.

"This exercise is part of the government's resolve to eliminate corruption, blackmoney, counterfeit currency and terror funding. This exercise has resulted in an increase in deposits with banks. This will facilitate reduction of interest rates and provide more headroom to banks to expand their credit base," the minister said.

Following demonetisation, several restrictions were imposed on withdrawal from banks as well as ATMs. The restrictions have been gradually removed.

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