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Published: Wed, November 09, 2016
Economy | By Melissa Porter

Withdrawing Rs 500, Rs 1000 notes surgical strike on black money: FinMin


Ramdev has been very vocal on the issue of black money and has even suggested ways to deal with it, one which was also doing away with bigger currency denominations.

Those who miss the deadline can deposit such notes along with a declaration at designated offices of the Reserve Bank of India by March 31, 2017.

In an surprise address to the nation today Prime Minister Narendra Modi announced that currencies with denomination of Rs 1000 and Rs 500 will not be legal tender from midnight tonight. "The RBI has been concerned about the growing menace of the fake Indian currency notes which has been increasing in numbers", Patel said.

RBI Governor Urjit Patel said the central bank had ramped up production of the new higher security currency notes of Rs 500 and Rs 2,000 that will replace the notes being taken out of circulation. As many as 16.5 billion notes of Rs 500 denomination are in circulation now while 6.7 billion Rs 1,000 notes are in market. There will, however, be an overall limit on withdrawal from banks of Rs. 10,000 per day and Rs. 20,000 per week, which will be increased in the coming days.

The Prime Minister also added that all banks will remain closed for public work tomorrow.

Modi said that although the existing notes would be "worthless", members of the public would be able to exchange them for new bills at banks until December 30. "There will be no change in any other form of currency exchange be it cheque, DD, payment via credit or debit cards etc", Modi said.

For the next 72 hours, these denominations will continue to be accepted at state-run hospitals, airports, bus stands, railway stations, and ration shops.

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