Nepal Lifts Decade-Long Ban on High-Value Indian Currency, Sets ₹25,000 Carry Limit

The Cabinet decision on Monday follows amendments by the Reserve Bank of India to the Foreign Exchange Management (Export and Import of Currency) Regulations, 2015

Cabinet Approves Revised Currency

Nepal has officially relaxed its long-standing restrictions on carrying high-denomination Indian currency, ending a ban that had been in place for nearly a decade. As per a recent cabinet decision, individuals are now permitted to carry Indian banknotes of ₹200 and ₹500, subject to a maximum ceiling of ₹25,000 per person.

Rule Applies to Cross-Border Travel

Under the revised provision, both Indian and Nepali citizens are allowed to bring higher-denomination Indian notes into Nepal from India or carry them from Nepal while travelling to India. The decision, taken during Monday’s cabinet meeting, is expected to simplify financial transactions for people who frequently travel across the open India–Nepal border.

RBI Regulation Changes Paved the Way

The cabinet decision follows recent amendments by the Reserve Bank of India (RBI) to the Foreign Exchange Management (Export and Import of Currency) Regulations, 2015. These amendments permit Indian, Nepali, and Bhutanese nationals to carry higher-denomination Indian currency while travelling to and from India, removing a key regulatory hurdle that had restricted such movement for years.

Nepal Rastra Bank to Issue Official Circular

Nepal Rastra Bank (NRB) spokesperson Guru Prasad Paudel said that once the cabinet decision is published in the Nepal Gazette, the central bank will issue a formal circular. This circular will legally authorise the use and carrying of higher-value Indian banknotes by individuals travelling between the two countries.

Longstanding Demand Finally Addressed

Describing the decision as a long-pending demand, Paudel noted that Nepal had repeatedly raised the issue with Indian authorities due to the practical difficulties faced by travellers. “This was our longstanding request, and India responded positively,” he was quoted as saying, highlighting the improved coordination between the two neighbours.

Major Relief for Migrant Workers

The move is expected to bring significant relief to thousands of Nepali migrant workers who travel to India for employment. For years, currency restrictions forced them to carry their earnings in low-denomination notes, increasing the risk of theft, pickpocketing, and loss during travel. In some cases, individuals were detained or even jailed for unknowingly carrying ₹500 or earlier ₹1,000 notes.

Boost to Tourism and Hospitality Sector

Nepal’s tourism industry, particularly casinos, hotels, and hospitality businesses near the border, is also likely to benefit. The inability of Indian tourists to carry higher-value notes often limited their spending, directly impacting revenues. Tourism entrepreneurs have pointed out that many Indian visitors were unaware of the currency rules, leading to frequent fines, arrests, and negative travel experiences.

Positive Impact on Cross-Border Trade and Travel

With the new rule in place, smoother financial transactions are expected for tourists, traders, and business travellers from both countries. The decision is seen as a step toward strengthening people-to-people ties, boosting tourism inflows, and facilitating easier cross-border movement between India and Nepal.