At the same time, official sources said here that the matter has been resolved.
"As far as we understand, the matter was between Pakistan High Commission and a private banking entity. It had nothing to do with the government and has been resolved," official sources said.
Pakistan had lodged a protest with India over its diplomats in the High Commission in New Delhi allegedly not being allowed to withdraw their salaries, which is paid in US dollars, by the bank.
Asserting that not allowing its officials to withdraw their salaries was in breach of Vienna Protocol, Pakistan had threatened that in case the matter was not resolved soon, it may consider retaliatory action against salary disbursal for Indian diplomats there.
RBL Bank, an Indian private bank, holds the salary account of the Pakistan High Commission staff.
"We are not allowed to withdraw our own salary. It is not a demonetization issue. It appears that it is done more at the instructions of the Indian government," a senior Pakistan High Commission official had said.
Diplomats can draw their tax free salaries in dollars and only have to give reason for the withdrawal beyond USD 5,000.
According to Pakistan High Commission officials, they are not being allowed to withdraw their salaries and have been asked for 'letters of purpose' for withdrawal of any dollar amount.
Incidentally, demonetization has led to a sharp spike in demand for dollars and other foreign currency, making it scarce.