Keyser

at hotels & maybe some high end stores....& even there they will not give you the change back in dollars....they would do so in inr & there is a big shortage of that at the moment....trying to spend dollars here at the moment is a terrible idea....using credit cards is best for now till the cash situation becomes better in a few months....

oliver2002

Foreign currency is not widely known/accepted in India. After decades of currency controls peopl shy away from greenbacks.

Dieuwer

Just like Argentina you mean

Keyser

it's the first time such a move has taken place & is not likely to be repeated ever....but that doesn't change the fact that this could not have been planned in a worse manner if their life depended on it....i see the situation getting a lot worse before it gets better....

oliver2002

Worse. In 1985 my mother got raided by the FERA and 600-700 DM were confiscated. The case took 10 years to resolve. Having foreign currency in hand was illegal and heavily documented/policed till the early 2000s.

Dieuwer

Either way, I don't see how this move by Modi is making India a more "welcoming place" for tourists.
I had the idea to visit India in the near future, by now that I know that currency can be made worthless overnight, I am not sure if visiting is worth the risk.
And regarding paying for everything with plastic: all my colleagues of Indian decent tell me that credit cards are sparsely accepted and basically useless.

GUWonder

They even did this at the start of the international tourism and retirement age NRI visit season. It shows a level of amateurish behavior that is shockingly pitiful and amusing at the same time.

Keyser

then all your colleagues of indian decent probably haven't visited india in a very very long time because this is not true....

credit cards are accepted pretty much everywhere....you won't expect a street vendor to have a credit card machine but then again, you wouldn't expect that in other countries as well....but all regular shops & businesses accept credit cards & have been doing so for a long time....

GUWonder

That's far from being entirely accurate. There were ways to legally have some foreign currency in hand even in the 1980s and into the early 2000s too.

It wasn't as heavily documented/policed as it could have been. In the late 1990s and early 2000s, most illegal hoardings of foreign currency in India were basically ignored or otherwise not heavily policed.

But the accurate point is that foreign cash is mostly foreign to most Indians accepting payments for goods and services; and its users there are very limited.

Yep. There is a major shortage of small denomination bills. Need 0.5 kg of onions for 100, 500 or 1000 rupees? That's what happens when you need the onions and the vendor has no change to give back. And that's including the vendors willing to take the risk of accepting demonetized notes.

Keyser

like i said before, trying to steal the limelight from the us presidential election & trying to put other political parties on the back foot before 5 states go for assembly elections seems to be more valuable to modi than the reputation & well being of the country....

emma69

When I was there last month our driver was telling us that all his payments have to be made in cash (e.g. his rent to his landlord) and that if he wanted to buy a new vehicle, he had to have a large amount in cash to do so. Makes no sense for him to change the rupees in to any other medium certainly short to medium term, and I suspect, like many of the citizens, he does not pay income taxes, which is why it is not in the bank.

GUWonder

Most Indian citizens aren't legally required to pay any Indian/federal (aka Union) income tax. The amount and/or type of income excludes most Indians from owing income tax. And in large part this is why smurfing works now and will continue to work.

My bet is that most Indian drivers have most of their wealth stashed in physical non-cash property or in bank accounts. They are unlikely to be national income tax cheats since so few make enough money of the sort that is taxable as taxable income at the national level.

Car purchases in cash are normal for the working poor who use a vehicle as means of income-generation -- more so from the internal migrant workforce than legacy locals -- as cash is taken as a more reliable means of payment for settlement than non-cash paper.

The only people who consistently tell me the situation hasn't disrupted their lifestyle? The Indian military class and their family members. Not sure you're familiar with how India operates in this regard, but it didn't surprise me.

emma69

Thanks for explaining!

GUWonder

Liquidating jewelry or ancestral property for cash, in order to buy cars and other income-generating assets in cash, is quite ordinary for the working classes who use their most valuable assets to earn a living. They mostly don't earn enough money to have any federal income tax liability in India. And farmers are generally exempt from taxes on farm income. It's only the upper middle class and upper classes that have federal income tax liability in India, and most of those people don't keep the bulk of their wealth in cash outside banks. Even the "black income" that should have been taxed but wasn't is mostly not in cash outside of banks; it's mostly in physical property of some sort or another.

This mess from demonetization was only to last two days according to the government. Then they said it would work out within two weeks. Now the government says this may take two months before things get back to normal. Clowns.

samsam12

Landed in Delhi last night 9:30pm, before the North American flights.. 10-15 people in line at each atm and currency exchange after immigration, although I thought I noticed an atm before immigration. All atms are limited to 2k rupees per day per card. You can use multiple cards. Most people are paying for everything through thier hotel an putting it on a credit card. As for getting rupees, head to ICICI bank in Connaught place first thing as the banks open. (There were 500+ people in line) if your non Indian they will let you into the branch to exchange forex. The limit is 4500 rupees per week. (Roughly $60 usd, bring exact change as a $100 bill is worthless even for two people) once inside there are 4 ATMs you can also withdraw 1900 rupees from. If you withdraw 2k, you will get a 2k note which nobody has change for (we found the state beer stores can break these). Most money changers don't have enough new currency). And people are accepting usd so bring $1 bills