India: New Series of Banknotes Soon

[Bimat]

Economic affairs secretary Shaktikanta Das just announced that banknotes of all denominations (₹10, ₹20, ₹50, ₹100 and ₹1000, along with recently introduced ₹500 and ₹2000) with improved features, design and dimensions will be introduced soon. Apart from old ₹500 and ₹1000, banknotes of all other denominations will continue to remain legal tender.

I'm not sure if ₹1 and ₹5 banknotes are also getting redesigned.

Aditya

[dheer]

Interesting. Maybe they will stop the Rs 1 and Rs 5 notes.

[Bimat]

I'm now convinced that unearthing black money was never a chief aim of this decision. Preventing counterfeit currency is the aim.

Aditya

[dheer]

I'm now convinced that unearthing black money was never a chief aim of this decision. Preventing counterfeit currency is the aim.

Aditya

Interesting theory.

[Bimat]

They would have never introduced a ₹2000 banknote if curbing out black money was the aim. Advantage of doing publicity with 'black money' tag is that it increases the impact of the decision.

Aditya

[asm]

I'm now convinced that unearthing black money was never a chief aim of this decision. Preventing counterfeit currency is the aim.

I disagree. This move had multiple aims - remove counterfeit notes from circulation, remove unaccounted for money in hands of a few which would (in my guess be over 10 to 15% of all money in circulation), prevent further counterfeiting (there are rumours that a large amount of currency printing paper - far more than their needs, had been purchased by our neighbours which would by now have been printed) for atleast some more time to come, prevent use of these large amounts of cash during the up coming state elections...... and with the money that is not exchanged, the RBI will have enough surplus to pay the government for the extra funds required for arms purchases and some social service schemes without increasing deficit................... 

Did any one read how the secrecy was maintained? A note circulated prior to the cabinet meet had required that all ministers who attended a cabinet meet would have to leave their cell phones out - and after the meet, no minister was permitted to leave the place till the PM made the official announcement. This ensured perfect secrecy - unheard of in Indian politics. The meet was officially called to discuss about the PM's visit to Japan (which started today). The TV channels - who excel themselves in claiming to "break" news were broke as they had been predicting the PM's address to the nation would be on the border & Kashmir troubles........

Amit

[asm]

They would have never introduced a ₹2000 banknote if curbing out black money was the aim.

I disagree ..... the Rs. 2000 were introduced to speed up the replacement. since almost 85% of all notes in circulation were the 500's and 1000's, it would need a huge number of 100's to replace them. My thinking is that once the work is done, the banks may be quitely persuaded to withdraw the 2000's from circulation........... leaving only very few notes in circulation.

BTW, it appears that all the 10's & 20's that were not accepted by the public in general when they withdrew money from the banks are now out again.......... All banks seem to be paying out these notes here (in Ahmedabad). The news is that the 100's & 500 have been stacked up for ATM's and will come out only tomorrow. A few 2000's have been seen today.

Amit

[Bimat]

I'm informed that no redesign of ₹1 and ₹5 notes is planned.

Aditya

[dheer]

If the intent of Rs 2000 note was to fool horders into believing that higher denomination notes will not be demonetised ....

Or 2000 denomination will be abolished

Hard to believe

[Bimat]

Government will be spending over 20,000 crore rupees on introduction of these two new notes in next few months (think of production cost + logistical expenses etc). If they withdraw the ₹2000 note, then there's nothing more foolish than this.

Also, black money hoarders will be smarter this time. They will not hoard banknotes anymore. I can think of skyrocketing gold prices in next few months (the process has already begun).

Aditya

[dheer]

Hoarding gold does not help... People already hoard

But converting to cash before distribution or distributing gold is hard and not practical

[Enlil]

Hoarding gold does not help... People already hoard

But converting to cash before distribution or distributing gold is hard and not practical

There are other currencies that can be purchased, and not at the bank either.

[Bimat]

It is now said that the new ₹1000 banknote may feature Dr. Ambedkar. Many BJP leaders are putting pressure for this move as UP elections are near and putting Ambedkar's portrait on banknote will polarize Dalit votes towards BJP; which otherwise are mostly attracted by BSP (a regional party).

Aditya

[dheer]

It is now said that the new ₹1000 banknote may feature Dr. Ambedkar. Many BJP leaders are putting pressure for this move as UP elections are near and putting Ambedkar's portrait on banknote will polarize Dalit votes towards BJP; which otherwise are mostly attracted by BSP (a regional party).

Aditya

There was a similar rumour that Rs 2000 notes will have Sardar Patel. I am not sure if we will have Dr Ambedkar. It may open up can of worms.

[Bimat]

Did any one read how the secrecy was maintained? A note circulated prior to the cabinet meet had required that all ministers who attended a cabinet meet would have to leave their cell phones out - and after the meet, no minister was permitted to leave the place till the PM made the official announcement. This ensured perfect secrecy - unheard of in Indian politics. The meet was officially called to discuss about the PM's visit to Japan (which started today). The TV channels - who excel themselves in claiming to "break" news were broke as they had been predicting the PM's address to the nation would be on the border & Kashmir troubles........

Not quite so...

Aditya