IC black marketeering rife in bordering towns

BIRATNAGAR, Nov 23: Black marketeering of Indian Currency (IC) has grown in the Nepali towns bordering with India as growing illicit trade across the border has pushed up the demand for IC, rendering official supply inadequate.



On Tuesday, Republica traced authorized money changers selling Indian rupee 100 at Rs 164 in the market, which is Rs 4 higher than the official exchange rate fixed by the central bank. Local money changers said IC has been selling on ´premium´ because of short-supply. [break]



Unless the central bank issued more IC in the market, they said there is little chance of this parallel currency market abetting.



“NRB must review the policy that has tightened the supply of IC. This is pretty important,” said a money changer.



However, officials at Nepal Rastra Bank´s (NRB) Eastern Regional Office in Biratnagar said there is no shortage of IC in the market.



We are providing as much as IRs 25,000 to any individual approaching us for the exchange, said Nara Bahadur Thapa, chief manager of NRB´s Regional Office in Biratnagar. Apart from that, NRB has been also providing demand draft of as much as Rs 400,000 to a person traveling to India for education, medical treatment or business purposes.



“We will take strict actions against individuals, firms and institutions if they are found involved in the black marketeering of Indian currency,” Thapa told Republica.

Currently, NRB is providing IRs 60,000 per week to each of the 19 active money changers registered in Morang, Jhapa and Sunsari districts.



However, money changers said the IC issued by the central bank is too low compared to demand. “There is a demand for at least IRs 150,000 per week per counter,” said the proprietor of Money Changer.



Knowledgeable traders said the volume of IC that the central bank has been issuing in the market is too low as the volume of illegal trade has soared of late. “Taking benefit of this rise in demand, local money changers are misusing the supply and are helping informal currency market grow in collusion with black marketeers,” said a source.



Despite denying short-supply of IC, Thapa, however, admitted that he too has been informed about unscrupulous dealers, who are selling IRs 100 at around Rs 164.



“Though we instructed the currency dealers to sell IRs 100 at Rs 160.15, including an exchange commission of 15 paisa, we have information of IC being sold at much higher rates. If this information is found true, we will take strict action against the dealers,” said Thapa.



Money changers, meanwhile, claimed they are selling IC as per the rate fixed by NRB.

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