India Withdraws Rs500 And Rs1,000 Banknotes In Fight Against Graft, 'Black Money'

November 9:  India has withdrawn 500 and 1,000 rupee banknotes from circulation at Tuesday midnight. The Indian Prime Minister Narendra Modi on Tuesday announced of the withdrawal saying it was part of a crackdown on rampant corruption and counterfeit currency.

The surprise step appears designed to bring billions of dollars worth of cash in unaccounted wealth into the mainstream economy, as well as hit the finances of Islamist militants who target India and are suspected of using fake 500 rupee notes to fund operations.

“Black money and corruption are the biggest obstacles in eradicating poverty,” Modi said in an address to the nation adding "New 500 and 2,000 rupee denomination notes will be issued at a later date."

Modi also said militants operating against India were using fake versions of the 500 rupee note, worth about $7.50 at current exchange rates.

“Terrorism is a frightening thing … But have you ever thought about how these terrorists get their money? Enemies from across the border have run their operations using fake currency notes. This has been going on for years,” Modi said.