Nepal’s central bank has recently banned the use of Indian currency notes of Rs 2,000, Rs 500 and Rs 200 denominations, a move that could worry Indian travellers to the Himalayan nation where Indian currency is extensively used. On Sunday Nepal Rastra Bank issued a circular barring Nepali travellers, banks and financial institutions from holding, carrying or trading Indian bank notes above Rs 100, as media reported.
In its circular the central bank said that the Indian currency of 200, 500 and 2,000 denominations cannot be carried and used for trading.
Under the fresh guideline, Nepali citizens cannot carry these denominations to countries other than India. Likewise, Nepalis are also not allowed to bring such notes from other countries.However Indian notes of 100 or below are allowed for trading and conversion.
Earlier on last December 13th, the Cabinet had decided to publish the notification in the Nepal Gazette not to allow people to carry Indian currency notes above 100 denominations in Nepal.
The ban has been massively criticised by travel traders and entrepreneurs, saying that it would adversely impact the country’s growing tourism at a time when the government has announced ‘Visit Nepal’ campaign with an aim of drawing at least 2 million tourists in 2020.
As majority of Indians visit Nepal over land from bordering towns, it is not easy for them to convert their currency to dollar or Euro, they said.
The overland Indian visitors’ survey has revealed, 1.2 million Indians came to Nepal through the surface route while 160,132 travelled via air. The average length of stay of Indian tourists coming overland was 5.8 days. Average expenditure per visitor was as much as Rs 11,310, the report says.
The Indian government introduced new banknotes of Rs 2,000, Rs 500 and Rs 200 denominations after the demonetisation of old notes worth Rs 500 and 1,000 took place in 2016. However, the move hit countries such as Nepal and Bhutan where Indian currency is broadly used.
Nepal Premier K P Sharma Oli said earlier this year that demonetisation affects the Nepalese citizen and added that he would take up the matter with Indian leaders. People have been using the new Indian currencies in Nepal for nearly two years from now.
