Nepal's central bank, the Nepal Rastra Bank (NRB), has relaxed restrictions on carrying Indian currency across the border, a move expected to significantly ease travel and trade between the two neighbouring nations. Indian and Nepalese citizens can now carry Indian Rupee (INR) notes of ₹200 and ₹500 denominations, up to a limit of ₹25,000 per person, provided these notes were issued on or after November 9, 2016.
New Regulations Clarified by Nepal Rastra Bank
The NRB issued a fresh notice on Thursday, reiterating and clarifying regulations that were initially published in the Nepal Gazette on February 11. This clarification aims to ensure smooth implementation of the new provisions.
Previously, Indian currency notes of ₹500 and ₹1,000 denominations issued before November 9, 2016, were prohibited in Nepal following India's demonetisation drive. Those older notes remain banned under the updated rules.
Facilitating Cross-Border Movement and Trade
NRB spokesperson Guru Prasad Paudel emphasized that the new provision is designed to facilitate Indian tourists visiting Nepal and Nepalese nationals involved in trade and business with India. India serves as Nepal's largest trading partner and a primary source of tourists, while a substantial number of Nepalese citizens work and study in India.
However, strict rules apply to the movement of Indian currency. Nepalese nationals are permitted to bring Indian currency into Nepal only from India and cannot carry it from Nepal to any third country other than India.
Foreign Currency Declaration Rules
In addition to the Indian currency rules, the NRB notice also specified regulations for other foreign currencies. Nepalese nationals and foreign visitors can bring up to USD 5,000, or its equivalent in other foreign currencies, into Nepal without requiring a customs declaration. Any amounts exceeding USD 5,000 must be declared to customs upon arrival at the border or airport.
Historical Context: Post-Demonetisation Restrictions
The restrictions on certain Indian currency notes in Nepal stemmed from India's demonetisation policy enacted on November 8, 2016. This policy withdrew older ₹500 and ₹1,000 notes from circulation, replacing them with redesigned ₹500 notes and introducing new ₹2,000 notes (which have since been withdrawn). Following this, Nepal had imposed its own limitations on the use and movement of the affected Indian currency notes.