No scrapping of Rs. 2000; 200-rupee note coming soon

Miniter of State for Finance Santosh Kumar Gangwar cleared all the rumors on the withdrawal of Rs. 2000 notes and said that there was no news of its scrapping, adding the Rs. 200 note will be in circulation soon. “No news that Rs. 2,000 will be scrapped,” Mr. Gangwar said. “The reduction in the printing of new Rs. 2,000 notes is a separate issue. But that needs to be confirmed by the Reserve Bank of India. RBI will give information on Rs. 2,000 notes,” he added.

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The issue was raised in Parliament when opposition party asked Mr. Arun Jaitley if the new 2000 note will be scrapped and he did not answer. According to the reports, a top government official said that Rs. 200 note would be introduced in the markets in August.
“The paper for Rs. 200 notes were ready in the Mysuru paper mill in June. It should be in circulation next month,” the official said.

Lauding the introduction of Rs. 200 note, a State Bank of India (SBI) report recently said that it would serve as the “missing middle”. “It seems that there has been a significant move towards relocating distribution of currency towards smaller denominations post demonetisation. However, while such a move is laudable and consistent with the long term vision of a less cash economy, we need to consider the following issues.

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“Though the number of small denomination notes has increased, the mismatch caused by the presence of Rs. 2,000 denomination straight after Rs. 500 denomination is causing difficulties in exchanging the high denomination notes,” the SBI Ecowrap report noted.

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