Both Government and RBI print India’s currency notes under different units…

A news broke over the weekend saying an RBI official has been caught stealing banknotes from the printing facility at Dewas:

 In a serious breach of the government mint, the Central Industrial Security Force (CISF) caught a senior officer at the RBI-controlled bank notepress (BNP) facility in Dewas stealing newly printed currency notes. Currency notes worth Rs 90 lakh were recovered from his office and residence which he reportedly stole over a period of time. Security officials say the incident raises doubts over the mint’s audit of newly printed notes.

The media should have been more responsible with this as Dewas facility is under the Government of India. The Government owned Security Printing and Minting Corporation of India Limited has two facilities – Nashik (in 1928) and Dewas (in 1975).

Currency Note Press, Nashik Road and Bank Note Press, Dewas which are engaged in production of Bank Notes for our country as well as for foreign countries using state of the art technology. More than 40% of Currency Notes circulated in India are printed by these units. 

 RBI installed its own Printing unit called- Bharatiya Reserve Bank Note Mudran Private Limited– much later in 1996 in Mysore and Saboni:

The bank note printing in India started in 1928 with the establishment of India Security Press at Nashik by Government of India. Until the commissioning of Nashik Press the Indian Currency Notes were got printed from Thomas De La Rue Giori of United Kingdom. The second bank note printing press was established in Dewas (Madhya Pradesh) in 1975 by Government of India. With the growth in population and economic activity, the demand for bank notes has been steadily increasing. To bridge the demand and supply gap, the Government of India decided to establish two new bank note printing presses one at Mysore (Karnataka) and the other at Salboni (West Bengal)

…..Considering the magnitude of the project, the Company decided to establish the presses in two phases viz, Phase I for establishing a Mini Press with a single production line at each site which would be used as a testing ground for the new work methods and train the personnel for efficient running of the Phase II machines. The Phase II involved establishment of the Main Presses with 7 lines of production in Mysore and 8 lines of production in Salboni. The phase I was operationalised at Mysore and Salboni in June and December 1996 respectively. During 1998-99, the Mini Press machinery at both the sites after testing the work methods and the performance the machines was shifted to the Main Press. While all the seven lines of production at Mysore went on stream on 12^th May 1999, the Salboni Press was inaugurated on 12^th February 2000.

This error of attributing Dewas Press to RBI irked the central bank. It responded:

It has been reported in a section of the media that an RBI officer has been apprehended by CISF, stealing printed currency at the RBI printing facility at Dewas. It is clarified that the Bank Note Press (BNP), Dewas is a unit of Security Printing & Minting Corporation of India Ltd. which is not under the control of the Reserve Bank of India. Further, RBI does not have any official placed with BNP, Dewas. The reports, thus, are not based on facts.

RBI regrets to note that the facts were not verified before publishing the news reports.

This is all the more so post demonetisation in 2016 which is still in memory. There was a surplus of Rs 2000 notes and a deficit of new Rs 500 notes leading to all kinds of chaos as change for Rs 2000 was not available.  Later, there was news that both RBI and Government redistributed their tasks. The Government printed Rs 500 notes in Nashik  and asked RBI to print Rs 2000 notes under its Mysore press. Latter was ready and former lax leading to the chaos.

But then even RBI is to be blamed here. It should continuously educate people on currency management and its issues. It is a very interesting area and people should know how and from where they get their money power. We all think it is duty of RBI to print notes and attribute all news to the central bank.

But the government plays a role as well. Infact in terms of minting coins, government is the sole authority. Look at how other central banks discuss and post pictures about their notes. The best example is Bank of Nepal which has put up a publication listing all its banknotes since 1945..