Sudden move a 1978 redux!

New Delhi, November 8 

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The sudden move to demonetise Rs 500 and Rs 1,000 currency notes is not new. Rs 1,000 and higher denomination notes were first demonetised in January 1946 and again in 1978.

The highest denomination note ever printed by the Reserve Bank of India was the Rs 10,000 note in 1938 and again in 1954. But these notes were demonetised in January 1946 and again in January 1978, according to RBI data.

Rs 1,000 and Rs 10,000 bank notes were in circulation prior to January 1946. Higher denomination banknotes of Rs 1,000, Rs 5,000 and Rs 10,000 were reintroduced in 1954 and all of them were demonetised in January 1978.

The Rs 1,000 note made a comeback in November 2000. Rs 500 note came into circulation in October 1987. The move was then justified as attempt to contain the volume of banknotes in circulation due to inflation.

However, this is the first time that Rs 2,000 currency note is being introduced.

While announcing currently circulated Rs 500 and Rs 1,000 notes as invalid from midnight tonight, Prime Minister Narendra Modi said new Rs 500 note and a Rs 2,000 denomination banknote will be introduced from November 10. — PTI