Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: In a policy refinement with direct implications for millions of Nepali travellers, workers and cross-border traders, the Reserve Bank of India (RBI) has amended the Foreign Exchange Management Act (FEMA) rules governing the movement of Indian currency between India and its neighbours. The new circular introduces a crucial clarification: high-denomination Indian currency notes can now be carried into India from Nepal and Bhutan—up to a total of ₹25,000—while their use remains banned when taking such notes out of India.
The amendment, issued under Section 47(2)(b) of FEMA, 1999, distinctly outlines what Indian residents, Nepali travellers, and other non-residents may carry across the Nepal–India and Bhutan–India borders.
What the New Rule Clearly States
According to the revised provision, an individual (except citizens of Pakistan and Bangladesh) can:
Bring into India from Nepal or Bhutan
Indian currency notes above ₹100 denomination (including ₹500 and ₹2,000),
Up to a total limit of ₹25,000.
This is a major clarification for Nepali citizens who regularly travel to India for medical treatment, religious pilgrimage, education, trade, and employment.
Take out of India to Nepal or Bhutan
Indian currency notes only up to ₹100 denomination.
Carrying ₹500, ₹1,000, or ₹2,000 notes outbound remains strictly prohibited.
No restrictions on Nepalese or Bhutanese currency
Both countries’ currency notes can be freely taken into and out of India.
Strict Prohibition Continues for Pakistan and Bangladesh
Export or import of Indian currency to/from Pakistan and Bangladesh remains banned, except with specific RBI approval or government exemption.
Significance for Nepal
This clarification is crucial for Nepal where Indian currency is widely used in markets, border towns, tourism, and remittance-driven households. The policy removes prior confusion—especially after past episodes when Nepali citizens faced confiscation of high-value Indian notes at Indian airports and border points.
Financial experts in Kathmandu note that the circular:
Regularises the inflow of high-denomination Indian notes into India,
Encourages formal currency handling,
Strengthens compliance with anti–money laundering (AML) and counter-terror financing (CFT) standards,
Ensures accountability at border checkpoints,
And helps both nations maintain transparent cross-border financial flows.
The RBI’s updated FEMA provision also reinforces the importance of adopting formal banking channels, digital payments, regulated remittances, and documented currency exchange practices, especially for Nepali travellers who carry Indian Rupees for medical and religious visits.
Authorities in India and Nepal are expected to intensify coordination across customs, immigration units, and border police to enforce the new framework.
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