Reserve Bank of India (RBI) and the Government of India in Currency Printing: A Comprehensive Guide

The task of printing and distributing currency notes in India primarily falls upon the Reserve Bank of India (RBI). This responsibility is detailed in the RBI Act and requires approval from the Government of India for the design of these notes. This article provides a comprehensive overview of the entities and processes involved in currency printing in India.

Who Prints Money in India: The Roles of RBI and the Government of India

According to the RBI Act, the printing and distribution of currency notes are the main responsibilities of the Reserve Bank of India (RBI). The design of these notes must be approved by the Government of India before the printing process can commence. The core entities involved in the printing process are the Government-owned securities Printing and Minting Corporation and the BRB Note Mudran P Ltd, a subsidiary of the RBI. These companies are responsible for printing currency notes based on orders issued by the RBI.

Printing Presses and Currency Production

Four printing presses play a significant role in the production of currency notes in India. Two of these presses are owned by the RBI, through its subsidiary BRB Note Mudran P Ltd, and are located at Salboni and Mysore. The other two presses are owned by the Government of India, located in Nashik and Dewas. These presses are strategically situated to ensure the efficient distribution of currency in different regions of the country.

Notes of the value of Rs. 1/- and Rs. 2/- and above are printed at these presses. The printed notes are then issued through the RBI's Issue Departments and around 4300 Currency Chests, which are managed by the State Bank of India (SBI) and a limited number of private sector banks. This ensures that the currency reaches every corner of the country in a coordinated manner.

Coastal and Regional Distribution

The printing presses are strategically located to cater to different regions of India. The press in Salboni, located in Eastern India, produces notes for the eastern region. The press in Mysore, in Southern India, caters to the southern part of the country. The Nashik press, in Western India, serves the western regions, while the Dewas press, also in the central region, meets the needs of central and northern India.

Government of India’s Role in Coin Minting

While the Reserve Bank of India (RBI) is responsible for printing paper currency, the Government of India handles the minting of coins. The Government of India owns four minting facilities, located in Mumbai, Hyderabad, Kolkata, and NOIDA. Coins in India are produced by these mints, ensuring that the public has access to both types of currency.

Annual Volume and Requirements

The volume of currency notes to be printed each year is determined based on the anticipated increase in the need for banknotes. This increase is necessary for several reasons, including the replacement of soiled notes and the reserve requirement by the RBI. The exact quantum of banknotes required is a nuanced process that takes into account various economic factors and the needs of the country's financial system.

In summary, the Reserve Bank of India (RBI) and the Government of India play distinct yet complementary roles in currency printing in India. The RBI is responsible for printing paper currency notes, while the Government of India handles the production of coins. These entities work together to ensure the efficient and effective supply of currency to meet the needs of India's financial market.

Conclusion

The RBI and the Government of India have well-defined roles in maintaining the seamless flow of currency in India. The strategic distribution of printing presses and the production of both notes and coins ensure that the public has access to reliable and adequate currency.