The committee, headed by Mr V. Kishore Chandra S. Deo, presented its report in the Lok Sabha here on Friday. The committee was informed that the printing of 2,000 million notes of Rs 100 denomination (Rs 20,000 crores) and 1,600 million notes of Rs 500 denomination (Rs 80,000 crores) were outsourced to the American Banknote Company (US, 635 million pieces of Rs 100 denomination) and Thomas De La Rue (UK, 1,365 million pieces of Rs 100 denomination), and Giesecke & Devrient Consortium (Germany, 1,600 million pieces of Rs 500 denomination).
On further inquiry, the committee was also given to understand that such outsourcing of the printing of notes was not done “either prior to 1996 or after that (after 1997-98)”.
The reasons given by RBI representatives, such as the bad conditions of the notes and the soilage factor, are far from “convincing”, the committee said.
The RBI system of assessment with respect to the demand for bank notes in the country has been off the mark, resulting in a gap between demand and supply, but this is a factor that was constant prior to and after 1996. The committee in its report said it rejects the reasons that have been forwarded for this “extraordinary decision which is unprecedented”.
The committee said it also finds it pertinent to point out that during printing of currency notes worth Rs 1 lakh crores in three different countries, there was always a grave risk of unauthorised printing of excess currency notes which would have been unaccounted money. The committee said it simply wonders how such a decision was taken — to print currency notes by three different companies in three different countries.
“Logically speaking, since all the said three countries are well developed, each country certainly had the capability of undertaking the entire printing assignment. In any case the very thought of India’s currency being printed in three different countries is alarming to say the least. During that particular fateful period our entire economic sovereignty was at stake,” the committee felt.
Expressing concern at the grave implications of such a move, the committee viewed the danger of destabilising the economy by agencies or authorities who could have misused Indian security parameters vis-à-vis printing of currency notes. “The use of such notes, which could have been printed in excess, could easily have fallen into the hands of unscrupulous elements such as terrorists, extremists and other economic offenders, looms large in our minds,” the committee said.
The committee expressed strong resentment at the “unprecedented, unconventional and uncalled for measure and recommended that the Security Printing and Minting Corporation of India Limited (SPMCIL) be strengthened to undertake the printing and minting of required currency notes/coins”. It said it “fervently emphasises” that oursourcing of printing of currency notes/minting of coins should never be resorted to in the future.
Venkatesh Kesari