New Delhi, Nov 22 (IANS): Terror funding has been badly hit by demonetisation of Rs 500 and 1,000 notes as their counterfeit supply from Pakistan was affected, Parliament was informed on Tuesday.

The minister also said that incidents of stone pelting in the Kashmir valley had reduced due to this move.

"The biggest impact of demonetization is that it has led to a decline in stone pelting incidents in Jammu and Kashmir. Apart from it, the decision, has badly hit terror funding," Minister of State for Home Affairs Kiren Rijiju said in the Lok Sabha during Question Hour.

He was responding to a query raised by BJP MP Rama Devi.

She sought to know from the minister whether the decline in stone pelting incidents prove that separatists were paying stone pelters and other anti- national elements the currency notes of Rs 500 and Rs 1,000.

The minister said that the Centre and the Jammu and Kashmir governments were working together to bring normalcy in the Kashmir Valley.