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In a recent discussion on Akashvani's program Spotlight, Dr. Sharad Kohli, an Economic Analyst, shed light on the withdrawal of the 2000 rupee denomination banknotes. Hosted by Rajesh Lekh, an Akashvani Correspondent, the conversation aimed to address common queries surrounding this decision.
Dr. Kohli began by clarifying that the withdrawal of currency notes is a routine process as each note, especially paper currency, has a life span of four to five years. The 2000 rupee notes were introduced as an ad hoc measure after the demonetization in 2016, filling a gap in the value of circulating currency. However, their usage declined over time, and as they became worn out and prone to counterfeiting, the Reserve Bank of India (RBI) decided to withdraw them.
The decision to withdraw these notes serves multiple purposes. Firstly, it prevents hoarding and illicit activities such as black money, terrorist funding, human trafficking, and smuggling. Additionally, the high-value 2000 rupee note occupies less space, making it easier to store large sums of money discreetly. By withdrawing these notes, the government aims to promote a cleaner and more transparent economy.
Dr. Kohli also explained that the Clean Note Policy has two interpretations. Firstly, it refers to the physical cleaning of currency notes, ensuring that good quality banknotes are available to the public. Secondly, it signifies cleansing the economy of hoarded money and curbing illegal activities associated with it.
Regarding the legal tender status of the 2000 rupee notes, Dr. Kohli emphasized that they remain valid for transactions. People can continue to use them until September 30th, 2023. While the RBI encourages depositing or exchanging these notes at banks, individuals without bank accounts can deposit the notes and withdraw smaller denominations to meet their cash requirements.
Crucially, Dr. Kohli emphasized that this is a withdrawal, not a ban. Unlike the 2016 demonetization, where specified notes became invalid, individuals can still exchange or deposit the 2000 rupee notes. The process of exchanging notes is akin to obtaining change for higher denominations and does not involve a ban on their usage.
The withdrawal of the 2000 rupee currency notes aims to maintain the integrity of the financial system, discourage hoarding and illicit activities, and promote the use of smaller denominations for everyday transactions. The RBI provides ample time and avenues for individuals to exchange or deposit these notes, ensuring a smooth transition.
The full Program can be accessed at https://youtu.be/4_p1KF6xJ8M