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Regular-article-logo Sunday, 10 May 2026

Cash priority nudge for diplomats

The foreign office has asked the finance ministry to allow officials from foreign missions here to withdraw cash from banks on "priority" amid growing frustration within the overseas diplomatic community here over the restrictions imposed following the ban on old high-value notes.

Charu Sudan Kasturi Published 09.12.16, 12:00 AM
Foreign secretary S Jaishankar and the dean of diplomatic corps, Frank Hans Dannenberg Castellanos (right), after their meeting in New Delhi on Thursday. (PTI)

New Delhi, Dec. 8: The foreign office has asked the finance ministry to allow officials from foreign missions here to withdraw cash from banks on "priority" amid growing frustration within the overseas diplomatic community here over the restrictions imposed following the ban on old high-value notes.

Foreign secretary S. Jaishankar also met the dean of the diplomatic corps, Dominican Republic ambassador Frank Hans Dannenberg Castellanos, today, after weeks of complaints from foreign missions that the constraints were hurting their work.

The Reserve Bank of India, following the November 8 demonetisation drive announced by Prime Minister Narendra Modi, had set a limit of Rs 50,000 a week for withdrawals from current accounts held by establishments - including embassies - more than three months old.

Individual bank accounts diplomats hold in India while working here are governed by the same Rs 24,000-a-week cap other citizens have to survive with under the post-November 8 rules and have to stand in the same snaking queues outside banks as everyone else.

But foreign missions have over the past month repeatedly protested the cap and the inconvenience caused to their diplomats, with Russian ambassador Alexander Kadakhin last week suggesting that his mission could no longer even host a dinner in a "decent restaurant".

"The finance ministry, as a consequence, is being asked to issue directives to banks to allow embassy officials with identity cards to withdraw money on a priority basis," foreign ministry spokesperson Vikas Swarup said. "We are keen to work with them (foreign missions here) to see what we can do."

While such directives will help individual diplomats get cash quickly, the challenge missions are facing in sourcing funds for operational expenses from their accounts remains - they are demanding that the Rs 50,000-a-week cap be raised.

Castellanos articulated this concern again, at his meeting with Jaishankar, officials present during the conversation confirmed to The Telegraph. The larger embassies - of the US, Russia, UK and China - have been particularly badly hit, because they need to spread over a larger staff the Rs 50,000 a week they can currently withdraw.

The foreign missions have also accused India of violating the Vienna Convention on diplomatic protocol, which states that a host country must allow foreign diplomats to carry out their work unimpeded.

Swarup today accepted the legitimacy of their concerns, and said these had been conveyed by the foreign office to the finance ministry.

But several foreign diplomats suggested they were losing patience. Castellanos alone had written at least four letters - including two to foreign minister Sushma Swaraj - without receiving any formal response prior to his meeting with Jaishankar today.

The ambassadors of Russia, Ukraine, Sudan, Ethiopia and Kazakhstan have also complained in writing to the foreign office.

The central banks of Nepal and Bhutan - the only two countries that accept Indian rupees as legal tender - have also asked the RBI for assistance, with Kathmandu seeking more time and Thimphu more cash in smaller currencies.

The foreign office has, however, merely referred these concerns to an inter-ministerial task force set up by the department of economic affairs to examine these complaints. The task force, which included a foreign office joint secretary, has submitted its recommendations but the department of economic affairs is still examining them.

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