Lokman Rawat, a seasonal migrant worker to India, was unaware that it was illegal to carry Indian banknotes of Rs 500 and Rs 1,000 denominations into Nepal, and had been stopped at the border by the Indian authorities a number of times.
Like Rawat from Salyan district who used to travel to Kanpur in India to work, many Nepali migrant workers suffered hardships because they had no idea about the currency restriction. Traditionally, a huge number of Nepalis living close to the Indian border also hop over to India to do their shopping for things from daily necessities to fancy goods.
Nepal has maintained a ban on the use of Rs 500 and Rs 1,000 Indian banknotes at the request of the Indian government. On January 22, the Reserve Bank of India amended its regulation entitled Export and Import of Indian Currency to allow individuals to use these high value notes in Nepal and Bhutan.
Reports about the withdrawal of the restriction have made migrant workers and shoppers happy. “I had heard the news that the ban would be lifted,” said Rawat who was returning home from India on Wednesday.
On Tuesday, Nepal Rastra Bank (NRB) announced that the ban on the use of Rs 500 and Rs 1,000 Indian currency notes had been cancelled. The central bank said in a circular sent to banks and financial institutions and money changers that it was okay to carry out transactions in the high denomination notes.
As per the circular, Nepali and Indian citizens are now permitted to carry Indian banknotes of Rs 500 and Rs 1,000 denominations across the border. However, the central bank has set a limit of IRs 25,000 per person. NRB has also forbidden Nepali citizens from carrying Indian currency to and from third countries.
India is one of the major employment destinations for Nepalis. Thousands of Nepalis from the Mid- and Far Western regions travel to India to work annually. “These migrant workers, unaware of the currency restriction, usually faced penalties in the past,” said Krishna Prasad Shrestha, president of the Nepalgunj Chamber of Commerce and Industry. “The lifting of the currency restriction is a welcome move.”
He added the move would not only make things convenient for Nepali jobseekers in India but also benefit Indian nationals who come to Nepal for shopping. The end of the currency restriction means less hassles for Indians who come to Nepal for medical treatment. Similarly, the lifting of the ban will also put an end to the practice of agents charging a high commission for exchanging Indian currency. They have been charging 4-5 percent as commission. “Now such trends will end,” said Gorakh Dangi, a resident of Jumla returning from Haridwar, India.
There has been rampant smuggling of Indian currency through the bordering points.
Last Saturday, the Armed Police Force had seized IRs 653,000 and handed it over to the Revenue Investigation Office in Kohalpur. Government officials said that smuggling would also end as high denomination notes had been allowed.