Pakistan’s Senate has recommended scrapping the country’s 5,000 rupee ($48; £38.50) banknote, despite government opposition, according to reports. A resolution, which is not binding, has called for the government to remove the notes to “reduce illicit money flow”.
Two months ago, India’s Prime Minister Narendra Modi surprised the country by scrapping 1,000 rupee and 500 rupee notes overnight, The move led to acute currency shortages in India.
Scrapping the Pakistani banknote was proposed by Senator Osman Saifullah Khan, who said it was being used in illegal transactions and should be withdrawn, Pakistan Today reported. He said the banknote should not be withdrawn overnight, but over a period of three to five years.
Law minister Zahid Hamid opposed the resolution, saying the move would hamper business activities. Pakistan has a large informal economy. The government has offered tax amnesties to try to expand the country’s tax base.
The 5,000 rupee note accounts for almost one third of the 3.3 trillion rupees of notes in circulation in Pakistan.