Pakistan Resolves to Demonitize high denomination Rs 5,000 currency notes

Pakistan Resolves to Demonitize high denomination Rs 5,000 currency notes

Weeks after demonetization of high currency notes in India, Pakistan’s Senate on December 19, 2016, passed a resolution to withdraw high denomination Rs 5,000 currency notes to curb the flow of black money in the country. The Senator Usman Saif Ullah Khan of the Pakistan Muslim League tabled the

resolution that was endorsed by the majority of law makers in the upper house of Parliament.

According to the resolution, the currency ban will be implemented in phased manner over the next three to five years to clean the market of this high-value note.

iv. The country’s lawmakers believe the currency ban will encourage people to use bank accounts and restrict the circulation of black money.

v. However, Law Minister Zahid Hamid said that the withdrawal of the notes will create crises in the market and the people will resort to foreign currencies in absence of Rs 5,000 notes. He said that currently 3.4 trillion notes are in circulation in country of which 1.02 trillion notes are of Rs 5,000 denominations.

vi. Pakistan is the third country after India and Venezuela to demonetise high-value notes in 2016. Indian Prime Minister Narendra Modi announced demonetization on November 8 to curb the circulation of black money, end terror funding and weed out corruption.

vii. On December 14, Venezuelan President Nicolas Maduro had announced that it would withdraw 100-bolivar bills, the biggest denomination currency notes in the country, to stop “mafias” from hoarding it abroad however the move was put on hold after violent protests Pakistan Rs.5000across the country