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Issuing new notes – a good decision

Central government and Reserve Bank of India (RBI) rightly took decision to issue currency-notes in denominations of rupees two hundred in accordance with set international norms which require denominations in currency and coinage to be in a closer range like in multiples of 1:2:5. By the same logic with re-issue of one-rupee notes after a gap of about two decades when these were discontinued with other low-denomination notes of rupees 2 and 5 for same reasons, re-issue of notes in denominations of rupees 2 and 5 is also a must in case central government does not reverse its decision by pausing any further printing of one-rupee notes. It is significant that in neighbouring Nepal, notes are in circulation rather than coins in denominations of 1, 2 and 5.

Compulsion of re-issue of one-rupee notes can be solved through legislative amendment whereby currency-notes other than of rupee-one may also be signed by bureaucrats rather than RBI governor. Everyone knows that one-rupee note was issued only for bureaucratic-craze to sign currency-note because it is the only denomination which is signed by a secretary-level bureaucrat unlike notes in rest other denominations which are all signed by RBI governor. It will also solve in-fighting amongst senior bureaucrats to sign one-rupee note, because then all the secretary-level bureaucrats in Union Finance Ministry will get sufficient opportunity so that notes in different denominations may be signed by different bureaucrats.

Madhu Agrawal

(The views expressed by the author in the article are his/her own.)

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