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Demonetisation hits businesses in India-Nepal border towns

black money crackdown Updated: Nov 18, 2016 19:28 IST
Sagar Suraj

More than 75 business outlets located on either side of the Indo-Nepal border remained closed for the ninth consecutive day on Thursday due to the cash crunch brought on by the demonetisation drive.(AP File Photo)

More than 75 business outlets located on either side of the Indo-Nepal border remained closed for the ninth consecutive day on Thursday following the sudden decision of the Indian government to demonetise high value currency notes of Rs 500 and Rs 1,000 denominations as part of a drive to fight black money.

Hundreds of people, along with a good number of Nepali citizens, queued up before Indian banks and ATMs located on the border.

Manoj Lakhotia, 39, owner of Vaishnavi Traders located on the main road in Raxaul, said: “We downed our shutters after customers stopped visiting out outlets since Rs 500 and Rs 1000 notes were scrapped. I am totally dependent on customers from Nepal for business.”

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Pawan Shahzada, a teacher in a government school at Semera in Nepal, is a shattered man. “I saved Rs 2 lakh of Rs 500 and Rs 1000 notes of India to get my wife treated at AIIMS in Delhi, but PM Narendra’s Modi’s sudden and abrupt decision has pushed me back by many years,” he lamented.

Incidentally, the Indian currency notes of Rs 500 and Rs 1000 denominations were banned in Nepal several years ago fearing proliferation of a huge quantity of fake notes in Nepali territory. The ban was subsequently lifted.

“We reposed our faith in the Indian currency again and the ban was lifted. But now I feel robbed now,” he said.

Following demonetisation in India, Nepal’s central bank instructed all Nepali banking and financial institution as well as Nepal Rashstra Bank to stop transaction of these two high values notes of India. Shahzada has been queuing up before India banks to exchange his amount in the name of his relatives. “So far I have been able to exchange only Rs 20,000 but now they have begun marking our fingers with indelible ink, what should I do now?” a desperate Shahzada asked.

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The situation has given rise to middlemen too.

Anil Sinha, a social worker at Raxaul, said: “Nepalis and Indians are getting their notes exchanged after paying huge commissions to middlemen. Almost all markets of Raxaul and Birgunj, which depend largely on Indian rupees, wore a deserted look as no customers were there.”

Dr Ajay Kumar, posted in a Nepali health centre, said: “People hired a middleman to get notes exchanged in India on commission basis, but he informed all of us after two days that all the notes were seized by police on the border.”

Raju Agarwal, a cloth merchant in Birgunj and also an officebearer of the Birgunj Commerce and Industries Association, said businessmen were having to pay their staff salary despite the fact their shops are closed. He, however, said a few Indian customers had started visiting the markets on the Nepal side from Thursday.

Bordering Nepal is largely dependent on Indian currency for trade and social responsibility. Dhruv Prasad Gupta, a businessman in Raxaul, said normalcy would return once new Rs 500 notes are circulated in these localities.

Threat for exchange

Central Bank of India’s regional manager Harishanker Thakur said they were facing threats from local people and traders for exchange of the banned notes. He said one of the senior managers of the bank in Raxaul had been threatened that he would be eliminated after he refused to exchange Rs 2 lakh of a local trader. A case has been filed against the businessman with Raxaul police station.

Also Read | SC questions reduced exchange limit of Rs 2000, says situation serious