RBI To Provide Nepal With Rs. 1 Billion In 100 Rupee Notes

The Reserve Bank of India (RBI) has agreed to supply Rs. 1 billion to the Nepal Rastra Bank (NRB) after the latter requested it in view of the shortage of Indian 100-rupee notes in the country. The NRB’s earlier plan to import Rs. 100 notes from India was delayed due to the demonetisation of higher value notes by the Government of India.

The RBI had asked its Nepali counterpart to wait for the situation in India to normalise. NRB officials have now announced that the new notes will arrive in January. Post the demonetisation exercise, NRB had lowered the exchange limit of Indian banknotes in Nepal. It currently allows an exchange of up to Rs. 2,000 on the basis of citizenship identification. The limit is raised to Rs. 10,000 for those who produce a valid rail or air ticket to India and Rs. 25,000 for those getting a medical checkup in India.

An NRB official said that the limit will not be reviewed till the RBI is able to provide notes. The RBI had been exchanging Rs. 6 billion every year, which is unlikely this year due to the cash-swap. NRB has brought only Rs. 1.2 billion this year and has Rs. 3.5 billion in its reserves. After receiving the additional 1 billion it will be able to provide cash exchange facilities to both Nepali and Indian nationals for the next eight to nine months.

With Inputs from IANS.