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Indian Govt. withdraws Rs 500, Rs 1,000 notes to strike on black money : Rs 500, Rs 1,000 notes will be banned from Tuesday midnight
TIWN Nov 8, 2016
Indian Govt. withdraws Rs 500, Rs 1,000 notes to strike on black money : Rs 500, Rs 1,000 notes will be banned from Tuesday midnight
PHOTO : Take a look at the new Rs 500, Rs 2000 notes to be circulated soon. TIWN Pic Nov 8

NEW DELHI / AGARTALA, Nov 8 (TIWN): The Union Finance Ministry on Tuesday said the move to withdraw Rs 500, Rs 1,000 currency notes is the biggest "surgical strike" by the government to curtail black money in the economy. "This is the biggest and the boldest step by the government for containing black money. It is like a surgical strike on black money," tweeted Revenue Secretary Hasmukh Adhia. Prime Minister Narendra Modi, in a sudden address to the nation on Tuesday, announced that Rs 500 and Rs 1,000 denomination notes are being withdrawn from midnight and will now become "mere paper". Modi said this was being done to tackle the menace of black money in the country, which has sapped the economy. The Prime Minister said that the Rs 500 and Rs 1,000 denomination notes can be deposited in banks and post offices, and also exchanged across the bank counter by showing government-issued ID proof.

The decisions come after a cabinet meeting.Expressing concern over the circulation of fake currency notes, Reserve Bank of India Governor Urjit Patel on Tuesday said the apex bank will launch new Rs 500 and Rs 2,000 currency notes from November 10. "RBI will launch new currency notes from November 10," Economic Affairs Secretary Shaktikanta Das said while unveiling the new notes.

Both Patel and Das were briefing media after Prime Minister Narendra Modi in a sudden address to the nation on Tuesday, announced that Rs 500 and Rs 1,000 denomination notes are being withdrawn from midnight. He said that such notes will become "mere paper". 

"Banks will keep record of people who will come to exchange cash," Das added.

On the other hand, as part of sweeping steps to battle black money, Prime Minister Narendra Modi announced that Rs 500 and Rs 1,000 currency notes will cease to be legal tender from midnight of Tuesday.

The Prime Minister said in a televised address that all the 500 and 1,000 denomination notes can be deposited in banks and post offices between November 10 and December 30.

They can also be exchanged across the bank counters by showing government-issued ID proof. 

New Rs 500 and Rs 2,000 denomination notes will be issued, he said.

"The existing 500 and 1,000 denomination notes can no more be used for transactions," Modi said, speaking first in Hindi and then in English. "They are now only mere paper."

The Prime Minister said these measures will help the government to fight corruption, black money and counterfeit currency, which he alleged was funding terrorism.

Modi said this was being done to tackle the menace of black money in the country, which he said had sapped the economy.

He also said that ATM withdrawals will be restricted to Rs 2,000 per day till November 11, after which this limit may be increased slowly.

Withdrawals from bank accounts will be limited to Rs 10,000 for the first few days, he said.

Banks have also been ordered to remain shut on Wednesday.

Modi said that for medical reasons, the old notes will continued to be accepted till November 11.

He also said that retail petrol pumps will accept such notes till November 11, after which they will have to keep a register of such notes for some time.

Tuesday's far-reaching decisions came after a cabinet meeting.

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