Originally Posted by
oliver2002
The 1000 notes are the common currency of 'black' money, so evidently the RBI wants to destroy the parallel economy that way. Great.
Technically you are not allowed to take INR with you when leaving the country, so cash taken abroad is invalid anyway.
I think I have 20-30k at home...
This demonetization/currency restriction on 500 and 1000 notes wasn't initiated by the career bureaucrats at RBI. This was a move pushed into place right from the PMO.
Indian cash outside of India is still technically valid. Technically, even you may be allowed to take some Indian cash out of India. I may be too. While prohibitions/restrictions of sort exist indeed on its export, it's technically not all banned; nor is all such cash invalid.
The common currency for dealing with "black" money is currency or physical assets. A 1000 rupee note is only worth around $15 (USD). No surprise that the biggest tax cheats in India don't store the bulk of their ill-gotten gains in Indian cash. Even the smaller tax cheats probably don't do it with 1000 notes.
Keep in mind they are putting in a 2000 note. Double the value of store for "black money".
Originally Posted by
oliver2002
Reading the RBI notification it seems it will not be a problem if you deposit the bills to your bank till Dec 30 or to the RBI in 2017:
The problem is in having to deposit the bills to the commercial banks or in having to deal with the RBI. It's not all that fun to wait in more and longer/slower lines than already usual before this governmental move; and yet now there is this additional hassle for individuals with zero "black money".
When was the last time that the Republic of India demonetized an INR cash note? It's very obnoxious to invalidate previously forgotten currency that perhaps even grandpa/grandma gave their little grandees decades ago for pocket money.
The bank account use restrictions for cash withdrawal are also obnoxious, especially at this time of year that hits seasonal moving NRIs and others with seasonal business/residential expenses in India that are more easily and appropriately settled in cash than in dealing with cheques and other means not used very much by the unbanked/underbanked in India.
Most of the unbanked/underbanked are probably too poor to owe any income tax. And yet this is a group most likely to have a very high proportion of their limited assets in cash.
This PMO-driven move seems to be a product driven by/for NDTV-type/tabloid media coverage. Let's see how long it is until such frenzied media coverage results in even more draconian financial measures.
This is reminding me somewhat of Argentina and its corralito. That led to a sort of gold mine for international travelers in the main for some time. This Indian move , however, is way less likely to be like it was in Argentina; but it is a hassle too. Fortunately, I'm not an Indian in a part of India where standing in a bank line with a large chunk of cash may make you a target; unfortunately, many others are and they face more issues with this than I would.