The new Rs. 2,000 and Rs. 500 notes were sent for printing only after the Reserve Bank of India (RBI) Governor Urjit Patel took charge on September 4. Though the decision was taken six months ago, the government waited for the new Governor to take over, and the plates were signed soon after by him.
A senior government official said this explained the signature of Urjit Patel on the new currency notes as it takes at least two months to switch over to new design plates. The initial plan was to phase out the existing banknotes in circulation.
“The process of changing the currency notes had been long overdue. It had been pending since 2011. When the NDA government came to power, the discussions began. But the entire process started moving in a decisive direction since May this year, when Prime Minister Narendra Modi gave the go-ahead. There is rationing of cash as printing started only two months ago as the machines had to be attuned to the new plates and security features,” said a senior official.
As reported by The Hindu earlier, the magenta Rs. 2,000 notes contain the same “covert” security features as the old Rs. 500 and Rs. 1000 notes.
Changing the security features is a huge exercise and takes anywhere between five and six years. The last time such an exercise was done was in 2005 when currency notes of all denominations with new security features were introduced.
There are three types of security features in a note: overt, which can de detected by the naked eye; semi-covert, detected by a hand-held machine; and covert, visible only in big machines installed at banks.
The government has said that the introduction of new notes would check counterfeiting. According to investigations done by the National Investigation Agency (NIA), much of the fake currency in circulation in India was printed in the government press of Pakistan.
“Pakistan was able to copy the overt security features of old notes, which is mostly the design part and was pushing in counterfeit notes in India. Though the covert security features in the new notes have not been upgraded, our investigations show that Pakistan was never able to crack the old ones either,” said a Home Ministry official.
Another official said it would take years to counterfeit the new notes. In normal circumstances any country changes its notes every 7-8 years with additional security features to check counterfeiting, he added.
There was no major change in the Rs. 1,000 notes introduced in 2000, while changes in the Rs. 500 notes, launched in 1987, were done more than a decade ago.