The value of the counterfeit currency in the banking system reduced from ₹43.47 crore in 2016-17 to about ₹8.26 crore in 2021-22, amounting to a sharp decline of more than 80%, according to a Finance Ministry reply in the Lok Sabha on Monday.
In response to Member Sanjeev Kumar Singari’s query, Minister of State in the Finance Ministry Pankaj Chaudhary said: “The number of counterfeit banknotes has come down from 7.62 lakh pieces in 2016-17 to 2.09 lakh pieces in 2020-21 post-decision of the Government of India to cancel the legal tender status of ₹1,000 and ₹500 denomination currency notes on November 8, 2016. The decision of demonetisation had several objectives including curbing of circulation of Fake Indian Currency Notes (FICN).”
As per the National Crime Records Bureau (NCRB) data, the value of fake currency seized by various enforcement agencies in 2017 was ₹28 crore. However, it shot up to ₹92.18 crore in 2020.
According to the report of the agencies, “there have been instances where it has been found that the fake currency has been smuggled from the neighbouring countries. While notes seized by different law enforcement agencies have gone up, there is a discernible trend of reduction in the number of counterfeit notes detected in the banking system,” he said in the written reply.
A Terror Funding and Fake Currency Cell in the National Investigation Agency (NIA) has been constituted to conduct a focused investigation of terror funding and fake currency cases. The government has also set up an FICN Coordination Group to share intelligence and information with the security agencies in the States and the Centre.
“Further, a Joint Task Force is functioning between India and Bangladesh for building trust and cooperation for exchange of information and analysis of smugglers of FICN. A Memorandum of Understanding (MoU) has been signed between India and Bangladesh to prevent and counter smuggling and circulation of fake currency notes,” said the Minister.
The government also conducts capacity-building programmes for various law enforcement agencies at the Centre/State level. Training programmes are held for the police officers of Nepal and Bangladesh to sensitise them about the smuggling/counterfeiting of Indian currency.
The Reserve Bank of India (RBI), which has in the past introduced several new security features to prevent counterfeiting of notes, has issued a master circular on the detection and reporting of fake currency, updated as of April 1, 2022.
