Ministry rules out re-introduction of Rs1,000 notes
NEW DELHI: Within days of introducing new 200 rupee notes, the finance ministry on Tuesday ruled out re-introduction of Rs1,000 currency bills that were scrapped as part of the demonetisation move last November.
“There is no proposal to reintroduce 1,000 rupee note” said Economic Affairs Secretary Subhash Chandra Garg in a tweet.
The statement comes amid reports that the government may re-introduce Rs1,000 notes. The government had announced the withdrawal of old Rs500 and Rs1,000 currency notes on November 8, 2016, with an aim to check black money, counterfeit notes and terror financing.
The Reserve Bank on August 25 had launched a bright yellow Rs200 notes to ease pressure on lower-denomination currency bills and also fill the “missing link” between Rs100 and Rs500 currency. Post demonetisation on November 9 last year, the Reserve Bank had introduced Rs2,000 notes and also issued new Rs500 bills with additional security features. Besides 200 rupee notes, Rs50 currency bills with new look was also introduced earlier this month. The RBI has already announced that it would be ramping the supply of Rs200 notes.
The optimal system of denominations of currency (coins and notes), the RBI had said, is one that would minimise the number of denominations and concurrently increase the probability of proffering exact change.
“So, what should be the optimal mix of currency denominations? Many countries have opted to use a near variation of the Renard Series, i.e., 1:2 or 1:2.5 ratio between adjacent denominations of currency, which means that the denomination should be twice or two and half times of its preceding denomination,” the central bank had said. Such a ratio allows exchange of value ordinarily in a maximum of three denominations, it added.
Last week, Finance Minister Arun Jaitley had said that the government was not considering banning Rs2,000 notes.