The common man is using more rupees to pay for goods and services, and the Reserve Bank of India is spending more to get paper rupees printed. Data compiled from RBI’s annual reports shows the cost of printing currency notes in 2021-22 at ₹4,984.8 crore was almost 1.5 times the ₹2,063.16 crore spent in 2008-09.
In fiscal year 2021-22, RBI spent 24 per cent more on printing notes than it did in 2020-21 (Rs 4,012.09 crore), and that too for fewer notes supplied from its printing presses. The overall cost of printing currency in FY22 was the second highest, after an all-time high of around Rs 8,000 crore was incurred in the year of demonetisation (2016-17).
While the volume of notes printed in FY22 was 41 per cent more than that in FY 09, the cost of printing in this period surged 141 per cent.
According to the data compiled, printing of currency notes touched a high of over 29,043 million pieces in the year of demonetisation (FY 2017), when printing costs also hit an all-time high. This has been attributed to printing of two sets of currency notes of Rs 500, besides one set each of Rs 1,000 and Rs 2,000. Old notes of Rs 500 and Rs 1,000 were demonetised at this time.
The annual reports state that in FY 17, apart from the higher number of note pieces printed, the withdrawal of SBNs (Specified Bank Notes in the denomination of Rs 500 and Rs 1000) led to an increase in the number of remittances , resulting in higher freight and forwarding expenses. For urgent supply across the country, notes were even remitted by air, resulting in increased expense on freight charges.
The annual reports show that till 2013-14, the cost of printing notes came under the head ‘security printing charges’ (primarily for printing of currency notes). In the following year, it was renamed as ‘Printing of Notes’.
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The annual report for FY14 highlights that Colour Shift Intaglio Ink (CSII), a security feature used in banknotes, is not imported any more. It is now indigenously manufactured at Varnika, the ink manufacturing unit at BRBNMPL, Mysuru, which meets the requirement of both BRBNMPL and SPMCIL. This has reduced import dependency in banknote production and has resulted in foreign exchange savings. The RBI aims to frame a strategy for complete indigenisation of raw materials for banknote production.
RBI gets currency notes from four printing presses -- two presses, at Nasik (Western India) and Dewas (Central India), are owned by the Centre, while the other two at Mysore (Southern India) and Salboni (Eastern India). are owned by the central bank through its wholly-owned subsidiary, Bharatiya Reserve Bank Note Mudran Ltd. (BRBNML). Coins are minted in four Government mints at Mumbai, Hyderabad, Calcutta and NOIDA.