The Reserve Bank of India (RBI) has reportedly stopped printing Rs 2,000 currency notes as the government suspects the high denomination banknote was “being used for hoarding, tax evasion and money laundering,” a media report said.
Note that, the report doesn’t mean that Rs 2,000 notes will become invalid. The announcement comes after banker Uday Kotak had said that the outcome of the controversial demonetisation drive would have been “significantly better” if “simple things” like introducing Rs 2,000 currency notes were avoided.
“I think we would have had significantly better outcomes if we had just thought about simple things. If you are taking out Rs 500 and Rs 1,000 notes, why would you introduce Rs 2,000 notes? ” Kotak had asked.
As of March 2018, the total value of the currency in circulation was Rs 18.03 lakh crore, of which Rs 6.73 lakh crore, or 37 percent, was in Rs 2,000 notes, and Rs 7.73 lakh crore, approximately 43 percent, in Rs 500 notes. The remaining was in the lower denominations.
The RBI’s annual report, released in August 2018, revealed that only 7.8 crore notes of the Rs 2,000 were added in 2017-18, taking the total number of bills in circulation to 336.3 crore as of March 2018.
In 2016-17, 328.5 crore Rs 2,000 notes were in circulation.
The share of the Rs 2,000 notes in the total currency in circulation has decreased as well: In March 2018, it was 37.3 percent, a fall of nearly 13 percentage points from 50.2 percent as of March 2017.
The share of the Rs 500 notes in circulation has increased too, from 22.5 percent in March 2017 to 42.9 percent in March 2018.
