The Indian government has finally responded to Nepal’s request to form a modality to exchange demonetised Indian banknotes of IRs500 and IRs1,000 denominations held by Nepali citizens.

The Indian government last week wrote to Nepal to propose a date to send its delegates to India to discuss and devise the modality. Responding to the letter from the Indian Finance Ministry, the Nepali side has requested that the meeting be held on Thursday.

“However, Nepal is yet hear from the Indian side regarding the proposed date,” said Chintamani Siwakoti, deputy governor of Nepal Rastra Bank (NRB) and coordinator of a technical committee formed to hold talks with India on the matter. “If the Indian government agrees on the proposed date, our team will fly to Delhi on Wednesday.”

During the meeting, Nepali delegates will also request the Indian government to allow exchange facility through the banking channel. “We will ask them to provide exchange facility for up to IRs25,000 in the banned denominations,” said Siwakoti. “As it was the Indian government’s decision to allow Nepalis to hold up to IRs25,000, they should provide exchange facility up to that limit.”

NRB has already prepared a modality to provide exchange facility to Nepalis, and according to Siwakoti, they will share their plan with their Indian counterparts.

The central bank, in its modality, plans to collect banned Indian bills of IRs500 and IRs1,000 denominations from Nepali citizens and send them to Reserve Bank of India (RBI) for verification before offering equivalent exchange in Nepali currency.

As per NRB’s modality, Nepali citizens have to open bank accounts in BFIs if they don’t have one and deposit the demonetised banknotes to receive the equivalent exchange directly in their bank accounts. The Nepali delegates, according to Siwakoti, will also query about the status of new Indian bank bills of IRs500 and IRs2,000 in Nepal. “We will ask the Indian counterparts about the future of such banknotes in Nepal,” he said.

The technical team will also request the Indian government to increase the annual quota of Indian currency supplied to Nepal. Currently, India supplies IRs6.2 billion in cash to NRB every year. “We will ask them to increase the supply,” Siwakoti.