RBI report shows increase in fake notes; Opposition attacks Centre over demonetisation

“During 2021-22, out of the total Fake Indian Currency Notes (FICNs) detected in the banking sector, 6.9% were detected at the Reserve Bank and 93.1% at other banks,” the RBI said.

Representational image.

Opposition parties on Sunday (May 29) launched an attack on the Narendra Modi-led government at the Centre over demonetisation after the Reserve Bank of India’s (RBI) annual report 2021-22 revealed that there is a more than 100% increase in counterfeit notes of ₹500 denomination.

On November 8, 2016, Prime Minister Modi announced the decision to ban ₹500 and ₹1,000 notes to fight against corruption, black money, and fake currency. Back then, the government introduced new ₹500, and for the first time ₹2,000 notes.

Also read: Demonetisation and GST: A tale of two economic ‘mis’adventures

On the fourth anniversary of demonetisation, in 2020, PM Modi had said the move had helped in reducing black money.

“Demonetisation has helped reduce black money, increase tax compliance and formalization and given a boost to transparency. These outcomes have been greatly beneficial towards national progress. #DeMolishingCorruption (sic),” he had tweeted on November 8, 2020.

Now, RBI’s annual report states that fake notes have increased in 2021-22 compared to the previous year.

“During 2021-22, out of the total Fake Indian Currency Notes (FICNs) detected in the banking sector, 6.9% were detected at the Reserve Bank and 93.1% at other banks,” the RBI said.

There was a 101.9% increase in fake ₹500 banknotes while it was 54.6% for ₹2,000 notes.

“Compared to the previous year, there was an increase of 16.4%, 16.5%, 11.7%, 101.9% and 54.6% in the counterfeit notes detected in the denominations of ₹10, ₹20, ₹200, ₹500 (new design) and ₹2000, respectively. The counterfeit notes detected in the denominations of ₹50 and ₹100 declined by 28.7% and 16.7%, respectively,” the RBI said.

 

Armed with RBI’s numbers on fake currency detection, Congress leader Rahul Gandhi said, “The only unfortunate success of Demonetisation was the TORPEDOING of India’s economy.”

Trinamool Congress (TMC) MP Derek O’Brien too shared the RBI’s numbers and wrote on Twitter, “Namaskar Mr PM @narendramodi DEMONETIZATION ? Remember ? And how @MamataOfficial swiftly took you on ? How you promised the nation Demo would WIPE OUT ALL COUNTERFEIT CURRENCY. Here’s the latest RBI report pointing out the huge increase in counterfeit notes.”

Priyanka Chaturvedi, the Shiv Sena MP too took a dig at the Centre. “One of the benefits of demonetisation being realised. Also, so happy to note that even the embedded chips in 2000 rupee notes have come good. Not.”

The RBI report stated that, as of March 31, 2022, more than 87% of total value of banknotes in circulation was ₹50 and ₹2000 notes.

Also read: 121% rise in fake ₹500 notes, 21.9% in ₹2,000 notes in 2018-19, says RBI

“The value and volume of banknotes in circulation increased by 9.9% and 5%, respectively, during 2021-22 as compared with 16.8% and 7.2%, respectively, during 2020-21. In value terms, the share of `500 and `2000 banknotes together accounted for 87.1% of the total value of banknotes in circulation as of March 31, 2022, as against 85.7% as on March 31, 2021. In volume terms, `500 denomination constituted the highest share at 34.9 per cent, followed by `10 denomination banknotes, which constituted 21.3% of the total banknotes in circulation as on March 31, 2022,” the RBI said.

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