To choke black money, Modi withdraws old notes, to introduce new Rs 500, Rs 2k notes

Move aimed to flush out black money hoarders, counterfeit notes; govt withdraws Rs 500 and Rs 1000 notes from midnight.

New Delhi: New Delhi: In an extraordinary step to tackle the scourge of black money in the country, Prime Minister Narendra Modi on Tuesday said Rs 500 and Rs 1000 notes will no longer be legal from midnight today.

In his first televised address to the nation, Modi said people holding notes of Rs 500 and Rs 1000 can deposit the same in their bank and post office accounts from November 10 till December 30. He explained that the currency notes will be just paper with no value.

“Notes of Rs 2000 and Rs 500 will be circulated soon, RBI has decided to limit the notes with higher value,” he added, saying some ATMs in the country may not function on November 9 and 10.

He assured the nation that the notes of Rs 100, 50, 10 and coins of all denominations will remain legal tender and will not be affected and that “this step will strengthen the hands of the common man in the fight against black money.”

The government also listed some exceptions to help minimise inconvenience to the common man, like hospitals will continues to accept the big currencies for the next 72 hours.

ATM withdrawals will be restricted to Rs 2000 per day and withdrawals from bank accounts will be limited to Rs 10,000 a day and Rs 20,000 a week.

Banks will remain closed tomorrow and ATMs will also not function tomorrow and day after, Modi said.

He expressed confidence that the staff of banks and post offices will rise to the occasion to introduce the new order within the available time.

He also expressed confidence that political parties, workers, social organisations and the media will go further than the government in making it a success.

Modi's announcement comes just days after some leaders suggested that currency notes of Rs 1000 and Rs 500 denominations should be abolished to curb black money in the country.

The Prime Minister said that black money to the tune of Rs 1.25 lakh crore had been unearthed during last two-and-a-half years.

(This story first appeared in Deccan Chronicle)