The Import Of Currency

The Import Of Currency

- by Rezwan Razack

The Import of Currency

In 1997-98, the Government of India, as a one-time measure, issued orders through the Reserve Bank of India to import a quantity of 3,600 million notes printed by German, Canadian, American, French and British companies for denominations of Rs.100 signed by Governor Mr. Rangarajan and Rs.500 partly signed by Mr. Rangarajan and partly by Governor Mr.Bimal Jalan.

Mr. Rangarajan was replaced by Mr. Bimal Jalan on 22^nd November 1997.  This necessitated a change in signature.  Hence the Rs.500/- notes were printed partly with the signature of Mr.Rangarajan and remaining with the signature of Mr. Bimal Jalan.  There was also an additional change in the note where “M. K. Gandhi” was expanded to “Mahatma Gandhi” below the portrait on the obverse.

Rs.500 – Signatory Governor Mr. Rangarajan; “M. K. Gandhi” written below Portrait

Rs.500 – Signatory Governor Mr. Bimal Jalan; “Mahatma Gandhi” written below Portrait

Rs.100 – Signatory Governor Mr. Rangarajan; “M. K. Gandhi” written below Portrait

The below mentioned international banknote printers supplied notes to the Reserve Bank of India:

• Giesecke and Derivant of Germany / Oberthur Fiduciaire France Consortium : 800 million notes of Rs.500 notes valued at Rs.40,000 crore.

• The Canadian Bank Note Company : 800 million notes of Rs.500 notes valued at Rs.40,000 crore.

• Thomas De La Rue of UK : 1,265 million notes of Rs.100 notes valued at Rs.12,650 crore along with Bundesdruckerei of Germany : 100 million notes of Rs.100 notes valued at Rs 1,000 crore, totaling to 1365 million notes valued at 13,650 crores.

• The American Banknote Company: 635 million notes of Rs.100 notes valued at Rs 6,350 crore.

The exercise cost the exchequer around $ 95 million.

Packing Certificate – Rs.100  – Thomas De La Rue & Company Limited

Packing Certificate – Rs.100  – ABN Co. - USA

Packing Certificate – Rs.500 – Francois-Clarles Oberthur Fiduciaire

Prefix Range:

500₹                            :           Without Inset

Prefix Range               :           AA-HD

Governor                     :           Mr. Rangarajan

Type                            :           6.8.2.1

500₹                            :           Without Inset

Prefix Range               :           HE-HW

Governor                     :           Mr. Bimal Jalan

Type                            :           6.8.2.2A

100₹                            :           Inset ‘A’

Prefix Range               :           AA-LW

Governor                     :           Mr. Rangarajan

Type                            :           6.7.11.1B

The import of this currency notes was in addition to the notes printed by Reserve Bank of India.

The Committee on Public Undertakings (COPU) criticized the Reserve Bank of India (RBI) and the Finance Ministry for outsourcing the printing of Indian currency notes amounting to a sum of Rs.1 lakh crore to three foreign countries in 1997-98.  The Committee described the move as “an unprecedented, unconventional and uncalled for measure.”

The COPU report was tabled in Parliament by its Chairman Mr. V. Kishore Chandra Deo.

The report recalled that 2,000 million pieces of 100 rupee denomination and 1,600 million pieces of 500 rupee denomination of notes were outsourced for printing at American Banknote Company (USA) - 635 million pieces, Thomas De La Rue-UK - 1,365 million pieces (100 rupee denomination) and Giesecke and Devrient Consortium (Germany) - 1,600 million pieces (500 rupee denomination).

Stating that the reasons for outsourcing by the RBI as:

·       bad condition of the notes

·       the ‘soilage' factor

The reasons attributed by the RBI representative to the Committee were “far from convincing”.  The Committee asked how a decision was made to get the currency notes printed abroad in three different countries.  “There was always a grave risk of unauthorised printing of excess currency notes, which would have been unaccounted money,” it said adding “that in any case the very thought of India's currency being printed in three different countries is alarming and during that particular fateful period our entire economic sovereignty was at stake.”

The Committee highlighted “the likely danger of destabilising the economy by the agencies or authorities who could have misused our security parameters vis-à-vis printing of currency notes, the use of such notes which could have been printed in excess could easily have fallen in the hands of unscrupulous elements such as terrorists, extremists and other economic offenders.”

The demand for bank notes has been steadily increasing. With a view to augmenting the production of bank notes in India and to enable the RBI to bridge the gap between the supply and demand for banknotes in the country the Government of India decided to establish two new bank note printing presses one at Mysore and the other at Salboni.

While all the lines of production at Mysore went on stream on 12th May 1999, the Salboni Press was inaugurated on 12th February 2000.

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Rezwan Razack

co-Author – ‘The Revised Standard Reference Guide to Indian Paper Money’

Chairman - IBNS India Banknote Collectors’ Chapter; IBNS # 9733

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