Government decides to print plastic currency notes

New Delhi, December 9

The central government told Parliament on Friday that it had decided to print plastic currency notes.

"It has been decided to print banknotes based on plastic or polymer substrate. The process of procurement has been initiated," Minister of State for Finance Arjun Ram Meghwal said in a written reply in Lok Sabha to a query whether the Reserve Bank of India intended to print plastic currency notes in place of paper ones.

The Reserve Bank for long has been planning to launch plastic currency note after field trials.

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 In February 2014, the central government had informed Parliament that one billion plastic notes of Rs 10 denomination would be introduced in a field trial in five cities selected for their geographical and climatic diversity. The selected cities were Kochi, Mysore, Jaipur, Shimla and Bhubaneswar.

Plastic notes have an average life span of about five years and are difficult to imitate. Also, currency notes made of plastic are cleaner than those made of paper. Such notes were first introduced in Australia as a measure against counterfeit notes.

Replying to another question, Meghwal said the RBI had said in December 2015 that they had received some banknotes of Rs 1000 without having security thread that were printed at Currency Note Press (CNP), Nashik, on paper supplied by Security Paper Mill (SPM), Hoshangabad.

Security Printing and Minting Corporation (SPMCIL) and the units involved (SPM and CNP) has initiated an inquiry.

"Major penalty chargesheet has been issued to the personnel concerned. Disciplinary proceedings have been initiated as per departmental rules," the minister said.

Meghwal said action has been taken to strengthen quality procedure and online inspection system in manufacturing process and special training has been given to the persons concerned to avoid such types of mistakes in future.

"Additional inspections have been introduced to ensure defect-free production," he said. — PTI