Banks have been told to allow embassy officials with ID cards to withdraw money on priority.
Highlights
- Banks told to allow embassy staff to withdraw money on a priority basis
- This follows Russia's threat to lodge a diplomatic protest against India
- Embassy officials are allowed to withdraw Rs 50,000 a week
Facing complaints from several embassies on the cash crunch after the notes ban announced last month, the government has instructed banks to allow foreign diplomats to withdraw money on a priority basis.
"The finance ministry is being asked to issue directives to banks to allow embassy officials with ID cards to withdraw money on a priority basis," External Affairs Spokesperson Vikas Swarup said today
Foreign secretary S Jaishankar today met the Dean of the Diplomatic corps, Frank Hans Dannenberg Castellanos. Mr Castellanos, the ambassador of the Dominican Republic, represents more than 150 envoys in Delhi. He had spoken out strongly on the difficulties faced by diplomats and written to Foreign Minister Sushma Swaraj requesting that the rules be eased.
Earlier this week, Russia had threatened to take "counter steps" and lodge a diplomatic protest with India, saying its diplomats are struggling for cash in Delhi.
Russian Government sources told NDTV that Ambassador Alexander Kadakin wrote to the Ministry of External Affairs on December 2 and threatened to summon the Indian envoy to protest against the Rs 50,000 a week limit on withdrawals.
In his letter, Mr Kadakin said the limit set by the government is "not even enough to pay for a decent dinner" and totally inadequate for operational expenses.
"How can such a big embassy in Delhi function without cash?" the envoy questioned.
On November 8, the government banned the two biggest currency notes of Rs 500 and Rs 1,000, which suddenly took away 86 per cent of the cash in circulation and left millions standing in line at banks and ATMs. To regulate the cash, the government imposed limits on the withdrawal and exchange of banned notes.
The MEA today said that "the vast majority of foreign missions understand that the demonetisation exercise is being conducted to combat black money".