The Reserve Bank of India's (RBI's) order on the withdrawal of ₹2,000 notes by September this year has become a hassle for those in possession of unaccounted money and now they are taking the familiar routes to dispose off these notes, a report by Business Standard pointed out.
The report added that such people are exchanging the ₹2000 notes for gold and dollars in the grey/unaccounted market, leading to huge premiums (over official rates) for both asset classes.
The market daily informed that on Friday night in New Delhi, gold was sold at ₹68,000 per 10 gm in exchange for ₹2,000 notes, while in official markets, gold was at ₹62,000-63,000 (including GST). Meanwhile, in cities of the south, Kolkata, and even Mumbai, the price is around ₹70,000 and above, added the report.
A dealer said “this time panic and rush are not like in 2016 because the magnitude is different. More time has been given, the notes remain valid, and, more importantly, in general people do not hold much of them. Politicians, real estate players, underworld leaders, and some traders dealing in cash hold most of the notes.”
Apart from gold, BS also revealed that players in the grey market for dollars also seem to have got wind of the withdrawal, and, as a result, from Wednesday itself the hawala rate, which was ₹85.5 to the dollar, had started rising to ₹87. The next day it rose to ₹88. It is now hovering at around ₹91.
BS also noted that the Indian Bullion and Jewellers Association has informed its members “ ₹2000 note is a legal tender (till 30-09-23) and hence jewellers can sell gold against (these) currency notes”. However, the message further said according to the guidelines of May 4, 2023, under the Prevention of Money Laundering Act, KYC is advised for cash transactions above ₹50,000. For cash transactions above ₹2 lakh, the PAN card is mandatory.
The association has further said if any jeweller is dealing in cash with a single person for ₹10 lakh or more at a time or in a series of transactions, the matter has to be reported to the Financial Intelligence Unit, the report added.
