Context
Recently, the head of a political party asked the central government to put pictures of Goddess Lakshmi and Lord Ganesh on currency notes in order to bring “prosperity” to the country.
About Design and Issuance of Indian Bank Notes and Coins
- The Reserve Bank of India (RBI) and the Central Government decide the changes in the design and form of bank notes and coins.
- Any change in design of a currency note has to be approved by the RBI’s Central Board and the central government.
- Changes in the design of coins are the prerogative of the central government.
Printing of currency
- Two of India’s currency note printing presses are in Nasik and Dewas.
- These are owned by the Government of India,
- Two other printing presses are in Mysore and Salboni.
- These are owned by the RBI through its wholly owned subsidiary, Bharatiya Reserve Bank Note Mudran Ltd (BRBNML).
Role of RBI in issuing notes
- Section 22 of The Reserve Bank of India Act, 1934, gives RBI the “sole right” to issue banknotes in India.
- Section 25 states that “the design, form, and material of bank notes shall be such as may be approved by the Central Government after consideration of the recommendations made by the [RBI’s] Central Board”.
- The RBI’s Department of Currency Management has the responsibility of administering the core function of currency management.
- If the design of a currency note has to change, the Department works on the design and submits it to RBI, which recommends it to the central government.
- The government gives the final approval.
Minting of coins
- The Coinage Act, 2011 gives the central government the power to design and mint coins in various denominations.
- In the case of coins, the role of the RBI is limited to the distribution of coins that are supplied by the central government.
- The government decides on the quantity of coins to be minted on the basis of indents received from the RBI on a yearly basis.
- Coins are minted in four mintsowned by the Government of India in Mumbai, Hyderabad, Kolkata and Noida.
Types of notes issued so far
- Ashoka Pillar Banknotes: The first banknote issued in independent India was the Re 1 note issued in 1949.
- It replaced the portrait of King George with the symbol of the Lion Capital of the Ashoka Pillar at Sarnath in the watermark window.
- Mahatma Gandhi (MG) Series, 1996
- Mahatma Gandhi series, 2005
- Mahatma Gandhi (New) Series, 2016
