The document provides an overview of the Indian rupee, including its history, minting and printing processes, security features, valuation in foreign exchange markets, and recent trends. It discusses how the rupee evolved from commodity money to its current form and outlines the security features of modern banknotes. Recent declines in the rupee's value are attributed to factors like high imports, inflation, and slowing economic growth. The Reserve Bank of India has implemented measures to control the rupee's fall, like liberalizing deposit schemes and promoting exports.

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Presented by- Team ‘Introspects’

2. Contents
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Introduction
History
Minting and Printing
Soiled and Mutilated Bank notes
Security Features
Valuation of Rupee in Forex Market
Trend analysis
Fall of rupee
Controls/Measures adapted to control the fall
Conclusion

3. Introduction
 “Money is any object or record that is generally accepted as
payment for goods and services and repayment of debts in a
given socio-economic context or country”
 Indian Currency- Indian Rupee (INR)
 Origin of the word "rupee" is found in the Sanskrit word rūp or
rūpā, which means "silver“

4. Introduction
Design
 Udaya Kumar-The designer
 The design resembles both the Devanagari letter “र" (ra)
and the Latin capital letter "R", with a double horizontal
line at the top.
र

5. Introduction
 Rupee- Mauritius, Nepal, Pakistan, Seychelles, and Sri
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Lanka.
The Indian Rupee- India.
The original Rūpaya was a silver coin weighing 178gm.
Controller- Reserve Bank of India.
The ISO 4217 code for the India Rupee is INR.
In India- Rupee, Rupaye, Rubai and Taka.

6. History
What was before 'Money'?
Barter System!!!
To barter is to exchange goods without involving money.

7. History
Barter System

8. History

9. History
Drawbacks of the Barter System
 No double coincidence of wants
 No specific unit of value
 No specific unit of measurement
 Inability of divisibility of goods
 Inability to transport goods

10. History
Stages of Evolution of Money
 Commodity Money
 Metallic Money
 Paper Money
 Notes and Coins
 Electronic Money

11. History

12. History
Entry of Rupee
During 3rd century BC under the rule of Mauryan
Empire there is a mention of:
 Silver coins - Rupyarupa
 Gold coins - Suvarnarupa
 Copper coins - Tamararupa
 Lead coins - Sisarupa

13. History
 During 1540-1545 Afghan king Sher Shah Suri issued a
coin of silver, weighing 178 grains
 The silver coin remained in use during the Mughal
period, Maratha era as well as in British India.

14. History
 Princely states of pre colonial India minted their
own coins resembling silver coins but with
regional distinctions

15. History
British Age
 Early English coins had 3 broad strands in Bombay, Madras,
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Calcutta.
Coinage Act-1835: Uniform coinage issued.
Coinage Act-1906: Governed the Mint establishments,
Standards to be maintained (Rupee 180 grains, Silver 916.66
standard; Half Rupee 90 grains).
World War-I: Due to acute shortage of silver, paper currency
was introduced.
RBI-1935: Established to respond to economic troubles after
world war II.

16. History
The values of the subdivisions of the rupee during British rule (and
in the first decade of independence) were:
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1 rupee = 16 anna (later 100 naye paise)
1 artharupee = 8 anna, or 1/2 rupee (later 50 naye paise)
1 pavala = 4 anna, or 1/4 rupee (later 25 naye paise)
1 beda = 2 anna, or 1/8 rupee (later equivalent to 12.5 naye paise)
1 anna = 1/16 rupee (later equivalent to 6.25 naye paise)
1 paraka = 1/2 anna (later equivalent to 3.125 naye paise)
1 kani (pice) = 1/4 anna (later equivalent to 1.5625 naye paise)
1 damidi (pie) = 1/12 anna (later equivalent to 0.520833 naye
paise)

17. History
 In 1957, the rupee was decimalised and divided into
100 naye paise.
 In 1964, the initial "naye" was dropped.
 Many still refer to 25, 50 and 75 paise as 4, 8 and 12
annas respectively.

18. History
Banknotes since Independence
 Ashoka Pillar Banknotes
 Mahatma Gandhi (MG) Series

19. History

20. Minting
Coins are minted at the five India Government Mints at
Mumbai, Alipore (Kolkata), Saifabad (Hyderabad),
Cherlapally (Hyderabad) and Noida (UP).

21. Minting
Denominations
 Presently being issued - 50 paise, one rupee, two rupees,
five rupees and ten rupees.
 Small coins- Coins upto 50 paise.
 Rupee coins- Coins of 1 Rupee and above.
 The coins issued under the authority of Section 6 of The
Coinage Act, 2011.

22. Minting
Distribution
 Coin Dispensing Machines.
 Dedicated Single window counters - issuing coins of
different denominations.
 Mobile counters - soiled notes can be exchanged for
coins.

23. Minting
Measures to improve the supply of coins
 Mints in the country have been modernised and
upgraded.
 Imported coins to augment the indigenous production.
 Notes in denomination of Rs.5 have been reintroduced to
supplement the supply of coins.

24. Appeal to the Public
“Members of public are requested to avoid holding on to
coins and instead, use them freely for transactions to
ensure that there is a smooth circulation of coins”

25. Printing
 Denominations Printed ` 10, ` 20, `50, ` 100 ` 500, and
`1000
 Old denominations still in use- ` 1, ` 2 and ` 5
 Issued by RBI and Guaranteed by Central Government
subject to provisions of sub-section (2) Section 26 of RBI
Act, 1934.

26. Printing
Cost of Printing of currency notes
Denomination
Cost of Production (in `)
5
0.47
10
0.96
20
1.46
50
1.81
100
1.79
500
3.58
1000
4.06

27. Minting & Printing
Currency Management
 Role of the Reserve Bank of India?
 Role of Government of India?
 Who decides on the figure to be printed on a new note?
 What happens to the old design notes when a new design
is introduced?
 Are old notes issued by the Reserve Bank of India
worthless?
 What was the highest denomination note ever printed?

28. Minting & Printing
Currency Management
 What is the role of RBI in issue of coins?
 Who is responsible for changing the design of coins from
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time to time?
What is currency paper made of?
Who decides on the volume and value of banknotes to be
printed and on what basis?
Who decides on the quantity of coins to be minted?
How does the Reserve Bank estimate the demand for
banknotes?

29. Minting & Printing
Currency Management
 Where are notes and coins produced?
 How does the Reserve Bank reach the currency to
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people?
What is a currency chest?
What is a small coin depot?
What happens when the banknotes and coins return from
circulation?
From where can the general public obtain banknotes and
coins?

30. Soiled and Mutilated Banknotes
 Soiled note: Dirty, two piece pasted together

31. Soiled and Mutilated Banknotes
 Mutilated banknote: Portion is missing

32. Soiled and Mutilated Banknotes
 Imperfect banknote: Wholly or partially shrunk, washed,
altered or indecipherable

33. Soiled and Mutilated Banknotes
 Can soiled and mutilated banknotes be exchanged for
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value?
Where are soiled/mutilated banknotes accepted for
exchange?
How much value would one get in exchange of soiled
banknotes?
How much value would one get in exchange of mutilated
banknotes?
How much value would one get in exchange of imperfect
banknotes?

34. Soiled and Mutilated Banknotes
 What types of banknotes are not eligible for payment
under the Note Refund Rules?
 Is the serial number used when assessing the value of a
damaged banknotes?
 What if a banknote is found to be non-payable?

35. Security Features
 To facilitate the detection of genuine notes vis-à-vis
forgeries.

36. Security Features
Watermark
 The Mahatma Gandhi Series of banknotes contain the
Mahatma Gandhi watermark with a light and shade effect
and multi-directional lines in the watermark window.

37. Security Features
Security Thread
 When held against the light, the security thread on
Rs.1000, Rs.500 and Rs.100 can be seen as one
continuous line.
 The Rs.5, Rs.10, Rs.20 and Rs.50 notes contain a
readable, fully embedded windowed security thread
with the inscription ‘Bharat’ (in Hindi), and ‘RBI’.

38. Security Features
Latent Image
 A vertical band contains a latent image showing the
respective denominational value in numeral.
 The latent image is visible only when the note is held
horizontally at eye level.

39. Security Features
Microlettering
 Appears between the vertical band and Mahatma Gandhi
portrait.

40. Security Features
Intaglio Printing
 The portrait of Mahatma Gandhi, the Reserve Bank seal,
guarantee and promise clause, Ashoka Pillar Emblem on
the left, RBI, Governor's signature are printed in intaglio
i.e. in raised prints, which can be felt by touch, in Rs.20,
Rs.50, Rs.100, Rs.500 and Rs.1000 notes.

41. Security Features
Identification Mark
 This feature is in different shapes for various
denominations (Rs. 20-Vertical Rectangle, Rs.50-Square,
Rs.100-Triangle, Rs.500-Circle, Rs.1000-Diamond)
 Helps the visually impaired to identify the denomination.

42. Security Features
Fluorescence
 Number panels of the notes are printed in fluorescent
ink. The notes also have optical fibres. Both can be seen
when the notes are exposed to ultra-violet lamp.

43. Security Features
Optically Variable Ink
 Incorporated in the Rs.1000 and Rs.500 notes.
 The colour of the numeral 1000/500 appears green when
the note is held flat but would change to blue when the
note is held at an angle.

44. Security Features
See through Register
 The design will appear as floral design when seen against
the light.
 Printed both on the front (hollow) and back (filled up) of
the note

46. Security Features
 Does possession of a forged note attract the
punishment of fine or imprisonment?
 What are the actions taken by the Reserve Bank of
India to train general public to distinguish genuine
banknotes from forged notes?

47. Valuation of Rupee In Forex Market
Today’s rate: 1$ = 61.88 INR
Exchange rate is the rate at which the one currency is
exchanged for another
How is the price of the Currency Determined ?
The change in the demand and supply of the
currencies has a direct influence on the exchange rate.

48. Valuation of Rupee In Forex Market
Factors Influencing demand and supply of
currency
 Expected Inflation Difference Between the two countries
 Interest Rate Factor
 RBI Intervention
 Market sentiments
 Speculation
 Imports and Exports
 Public Debt/Fiscal policy

49. Valuation of Rupee In Forex Market
S
Foreign Exchange Rate
(Rupee price of Dollars)
D
S1
1$=Rs60
1$=Rs55
D
S
S1
Quantity of Dollars

50. Trend analysis
Rupee- 1947-2013
 1947:
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1 ` =1 Sterling
1948-1966: 1 US$= ` 4.79
1966:
1 US $= ` 7.50
Aug 1971: Rupee's link with Sterling broken; tied to US
Dollar directly
Dec 1971 : Dollar devalued, Rupee tied to Sterling
again.
1975:
1$ = ` 8.39

51. Trend analysis
Rupee- 1947-2012
 1985:
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1$ = ` 12
1991:
1$ = ` 17.90
1993:
1$ = ` 31.37
Early 2000-2005: 1$= ` 44-45
2006-2007:
1$ = ` 39
2008-09 :
1$ = ` 49-50
2010-12 :
1$ = ` 50-Rs.56
2012-13 :
1$ = ` 54.4

52. “THE INDIA OF 2013 IS NOT THE
INDIA OF 1947”

53. Fall of rupee
 In 2013 the rupee slumped to a record low near 69 to the
dollar
 Since June, FIIs have pulled out $8.7 billion from the
debt market, but only $3 billion from the equity
segment
 GDP had touched 4.8% to its lowest in the last decade

54. Fall of rupee
Other factors
 Current account deficit
 Strengthening of dollar in US economy
 Inflation
 High Imports
 Ineffective economic policies
 Insufficient inflow and outflow of funds
 Did the Indian government deliberately allow the rupee
to fall?

57. Fall of Rupee
Result
Q. The fall in the rupee's value against the US dollar is
because of 1. Global economic slowdown:
19.9 per cent
2. Incompetence of Indian authorities: 39.3 per cent
3. Both:
40.7 per cent

58. Fall of Rupee
Impacts of fall of rupee
 Triggers inflation
 Hits investor sentiment
 Creates burdens for organization with high exposure to
foreign debt.
 Importers/Exporters
 Imported goods
 Fuel price

59. Fall of Rupee
Impacts of fall of rupee
 RBI’s monetary policy
 Students studying abroad
 Tourism
 Overseas Indians
 Country’s fiscal health

60. Video

61. “We Invented money and we use it, yet we cannot
understand its laws or control its actions. It has a life
of its own.”
-Lionel Trilling.

62. Controls/Measures adapted to
control the fall of Rupee
 Liberalisation of Bank Deposit Schemes.
 Reduction in Import of Gold, Silver and Oil.
 Tightened Liquidity of rupee in Banking System.
 Increase of Capital Inflows to the Country.
 Promotion of Exports.
 Increase of Interest Rates of Banks to its Customers.
 Ban of Duty free import of flat screen Telephones.
 Selling of Infrastructure Bonds.

63. Conclusion
 The Indian Rupee has depreciated significantly against the US
Dollar marking a new risk for Indian economy. Grim global
economic outlook along with high inflation, widening current
account deficit and FII outflows have contributed to this fall.
RBI has responded with timely interventions by selling dollars
intermittently. But in times of global uncertainty, investors
prefer USD as a safe haven. To attract investments, RBI can
ease capital controls by increasing the FII limit on investment
in government and corporate debt instruments and introduce
higher ceilings in ECB’s. Government can create a stable
political and economic environment. However, a lot depends
on the Global economic outlook and the future of Eurozone
which will determine the future of INR.