Kapil Sibal criticizes PM Modi’s decision to phase out ₹2000 notes

The Reserve Bank of India (RBI) on Friday announced the gradual withdrawal of ₹2000 denomination notes from circulation saying that it has served its purpose.

Taking to Twitter, Kapil Sibal highlighted Prime Minister Narendra Modi’s statement on November 8, 2016, which asserted a direct correlation between the magnitude of cash in circulation and the level of corruption.

Sibal pointed out that in 2016, there were ₹17.7 lakh crores in circulation, whereas, in 2022, the figure rose to ₹30.18 lakh crores. Sibal emphasized that corruption has witnessed an increase and questioned Modi regarding this matter.

According to the RBI, these notes introduced in November 2016 meant to meet the currency requirement of the time in the context of the demonetisation of the ₹500 and ₹1000 notes in cirulation at that time, has served its purpose. Printing of new ₹2,000 note was stopped in FY19 and most of these notes are at the end of their life span.

RBI’s decision to withdraw these notes are in light of its ‘clean note policy.’ The central bank has also made it clear that the stock of banknotes in other denominations continue to be adequate to meet the currency requirement of the public.

“ ₹2000 currency note will remain legal tender after 30th September too. RBI expects that 4 month time is enough for people to exchange notes with the banks. Most of the ₹2000 notes that are in circulation will return to banks within the given time frame of 30th September. This is a routine exercise of RBI and people need not panic,” news agency ANI quoted citing sources.

In order to ensure operational convenience and to avoid disruption of regular activities of bank branches, the exchange of ₹2000 banknotes into banknotes of other denominations can be made upto a limit of ₹20,000/- at a time at any bank starting from May 23, 2023.