The new series of the Rs 500 note and the Rs 2,000 note — both introduced after demonetisation in 2016 — together account for just over 50 percent of the number of counterfeit currency notes that have been detected, according to data submitted to Parliament by the government.
https://theprint.in/economy/demonetisation-failure-rs-500-rs-2000-notes-together-make-up-50-of-counterfeit-notes-detected/2225578/ This is especially significant because one of the stated aims behind the demonetisation exercise and the release of new variants of the bank notes was to reduce counterfeiting. Now, one argument for the increase in the detection of fake Rs 500 and Rs 2,000 notes could be that the security measures on these notes are working and that the fakes are being caught more effectively. However, this does not then answer why the total number of counterfeits has fallen. That is, if the government is getting better at catching fakes, then it should be finding more not less. On the other hand, if overall counterfeiting is falling, the question then is why it is increasing for Rs 500 and Rs 2,000 notes in particular.
by TCA Sharad Raghavan
16 August, 2024