Parliament Session: BJP MP Sushil Modi Calls For Phasing Out Rs 2,000 Note. Here Is Why

Rs 2,000 note was introduced by RBI to replace the demonetised Rs 500 and Rs 1,000 notes at a faster pace in 2016.

Bharatiya Janta Party (BJP) MP Sushil Kumar Modi in Rajya Sabha

Source : Twitter/Sushil Kumar Modi

BJP MP Sushil Kumar Modi on Monday demanded phasing out Rs 2,000 currency note in a gradual manner, saying that people in possession of such notes should be given two years to exchange them. Raising his concern during the Zero Hour in Rajya Sabha on Monday, Modi said that Rs 2,000 notes had vanished from most ATMs in the country and there were rumors they might not be legal tender soon.

The Rs 2,000 note was introduced by RBI to replace the demonetised Rs 500 and Rs 1,000 notes at a faster pace in 2016. 

Sushil Modi said that Rs 2000 note printing had stopped in the last three years owing to several challenges associated with the circulation. He said, “There was no logic of bringing a Rs 2,000 note when Rs 1,000 note circulation was stopped.” He cited examples of developed nations that do not have currency notes of higher denominations.

“The government should gradually phase out the Rs 2,000 note. Citizens should be given 2 years to exchange their holdings of the Rs 2,000 notes,” he said.

He said that the 2,000 rupee note had become synonymous with black money. “Instances of hoarding and black marketing of Rs 2,000 notes have been surfacing and people were compelled to buy them at a premium. They are also conducive in settling large cash-based transactions for illegitimate activities like terror financing, money laundering, corruption etc,” BJP MP said.

He said, “Since India is also becoming a hub for digital transactions which also entail settlements of larger amounts, there is limited need for having a high-denomination currency note of Rs 2,000. To this effect, I urge the Government of India to gradually phase out the 2000 rupee note over a designated time interval so that people can convert their legitimate holdings of the noted into lower-denomination notes.”