The RBI’s move to withdraw pre-2005 currency notes is in the interests of the nation. Unaccounted counterfeit currency puts a big strain on our economy and national security. Small traders need to be alarmed at the impending rigmarole as they do not carry or hoard large amounts of cash. With security features and identifiers and plans to introduce plastic-blended notes our currency will become counterfeit-proof. India is still a cash economy and needs such inventive measures.
The editorial, “New notes for old” (Jan. 24), offers a balanced perspective on the RBI’s bold decision. However, certain bureaucratic difficulties may arise as a consequence and these must be guarded against. Politicians and hoarders are sure to exploit the hackneyed “common man’s plight” to seek to extend the validity or continuance of pre-2005 currency notes.
Government servants will harass consumers by making a hue and cry about verifying currency notes and deploy other such dilatory practices. Given the scale of the process, private banks may outsource the exchanging procedure and national banks may appeal for the deferring of the deadline to help cope with the pressure.
The RBI and the government must not succumb to such pleas. They should stand fast on their decision as it is crucial to at least draw out the black money that permeates our economy.
The RBI’s decision to weed out pre-2005 currency notes of all denominations is ill-advised, and unwittingly it puts pressure on the common man — be it from rural or urban areas — to be extra vigilant. The central bank would have done well to have begun by withdrawing high-value cash denominations — Rs. 500, Rs.1,000 — and gradually covering all other currency notes. Lower denominations of notes are generally used by small traders, retailers and public transport systems.
It would be quite a task for all these persons, who handle money in poor light and in a haphazard, unsystematic manner, to ensure that they are not handling illegal tender. Moreover, such notes will continue to be in circulation in any case as hoarders are not likely to stock notes of lower denomination. The RBI should deliberate further before setting a time limit for the exchange.