Ahead of LS polls, Rs 2000 notes sharp drop from circulation!

Ahead of Lok Sabha polls, Rs 2,000 notes are conspicuously missing from circulation, since last one month.  Rs 2,000 are not available in banks and also ATMs in many places of the country. It was suspected to be due to heavy usage of these notes during poll campaign. The Bankers and service providers confirmed that there has been a sharp drop in the numbers of Rs 2000 in circulation.

It is also believed that the supply of notes from the central bank has plummeted in the recent month leading to the speculation that it could be a deliberate strategy to restrict the flow of high-value notes in the economy. You may not get Rs 2,000 notes from the bank ATMs in the next few months.

However, a report on the present cash crush also claimed that people are able to get Rs 2,000 notes only at ATMs run by banks. It too quoted officials as saying that politicians have started hoarding Rs 2,000 notes ahead of the general elections.

The Reserve Bank of India (RBI) data says the circulation of Rs 2,000 notes has seen a sharp fall in the past year. It is believed that the central bank is squeezing the supply of Rs 2,000 notes to prevent black money hoarding high denomination.

However, people believe that the currency notes of higher value are easier to hoard, and can also be used to proliferate black money. Moreover, the experts said that having a large number of Rs 2,000 notes in circulation would have defeated the purpose of demonetisation, which was to stop the circulation of black money.

In its annual report released in August 2018, the RBI said that the proportion of Rs 2,000 notes has fallen to 37 per cent in the circulation of the total currency from 50 per cent in 2017. The indent for the Rs 2,000 notes also fell from 350.4 crore pieces in 2016 to 15.1 crore in 2017-2018.

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