Currency: If the Reserve Bank of India’s (RBI) notification of doubling the amount of INR from automatic teller machines (ATM) is any indication, then the economy is beginning to recover from the demonetisation process.
The RBI on Monday issued a notification increasing the INR withdrawal from ATMs from Rs 4,500 to Rs 10,000 per card per day. However the weekly limit of Rs 24,000 is retained. But for Bhutanese the set limit of Rs 15,000 a month per card is still applicable.
This comes as a bonus to the Royal Monetary Authority’s (RMA) initiative of raising the INR exchange ceiling from Rs 5,000 a month per citizenship identity card to Rs 10,000.
The RMA is expecting to enhance the INR supply from Rs 100 million to around Rs 200 million a week.
According to Indian media reports, currency supply to the banking system will be closer to normal by February. It was also stated that the Indian economy will fully recover from the distresses caused by the demonetisation process by June this year.
As of December end, only 44 percent of demonetised notes had been replaced. It is estimated that by January end, only about 67 percent of the currency will be replaced and 89 percent by February, should the printing of new notes continue at the current rate.
However, for its Rs 1.68B worth of demonetised notes, the Central Bank is awaiting the green signal from the RBI to replenish the counter value.
“In just a few days we will hear from the RBI on counter value,” RMA governor Dasho Penjore said. As for the INR stock, he said the Central Bank is comfortable.
Sources said that all the INR collected in cash in Bhutan has been deposited with the State Bank of India and has been inspected along with the details of all depositors.
Once the equivalent amount in INR is injected into Bhutanese banks, RMA is looking into lifting the withdrawal limits.
Although the country has an INR reserve of close to Rs 30 billion, only a fraction of it was held in cash.