By Sudeshna Sarkar, IANS
Kathmandu : The Nepal government’s bid to curb terror activities and the circulation of fake Indian currency has now begun to produce a side effect, causing it to lose millions in revenue.
Currently, Nepal’s treasury has about Rs.25 million in banned Indian currency that is destined for the incinerator since the Indian government has reportedly refused to exchange the notes with ones that are legal in Nepal.
While Indian currency is accepted in Nepal, the government banned the use of 500 and 1,000 Indian rupee notes seven years ago. This was done to combat the growing racket in counterfeit Indian currency and bids by terror agencies as well as international criminal gangs to route money through Nepal.
Since then, carrying 500 and 1,000 Indian rupee notes is deemed a punishable offence in Nepal.
Passengers passing through Kathmandu’s international airport frequently wield caches of the banned currency. Raids by the revenue department also ferret out contraband notes.
Last year, the well known Pakistani rock band Jal, that came to perform in Kathmandu, ran into trouble when its manager Hasnan Alam was caught at the airport carrying over Rs.1 million in 500 and 1,000 rupee notes.
In the past, Nepal used to hand over the assembled notes to the Indian authorities in exchange for notes that were legal in Nepal.
Almost 13 years ago, India had taken back nearly Rs.600 million worth in Indian currency and exchanged it, a Nepali daily said.
However, now New Delhi is refusing to take the new haul, the Naya Patrika said.
Besides the Rs.25 million, there is another sizeable cache of Indian currency piled up in various courts of Nepal.
Some of the seizures are now being heard in court. Therefore the money is lying as evidence, not to be disposed of till the cases end.
For example, almost eight years ago, Lokesh Kumar Sharma was caught at the Tribhuvan International Airport with over Rs.6 million in banned currency.
The case is still being heard in Kathmandu district court and the money remains under court jurisdiction.
The daily said even the Indian joint venture banks in Nepal have refused to exchange the money.
Krishna Bahadur Manandhar, acting governor of Nepal’s apex bank, Nepal Rastra Bank, said Nepal SBI, a joint venture of the State Bank of India, has declined to exchange the money, citing legal problems, the daily said.