What is the procedure to print money in india?

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In india or other countries are printing their country Dolor, money , euro, Dir-ham or others.what is the procedure to print their country currency? what basic rule is there in ...show more
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In fact most of the educated population in any country, use the local currency without knowing the background and validity of the same. I am happy that you have asked this question, which will impart a mandatory knowledge to many people all over the world. Because what is in India is applicable to all over the world.

A) What and who decides the money (currency) in circulation in Indian money market ?

a) The Reserve Bank of India (RBI) manages currency in India. The Government, on the advice of the Reserve Bank, decides on the various denominations. The Reserve Bank also co-ordinates with the Government in the designing of bank notes, including the security features. The Reserve Bank estimates the quantity of notes that are likely to be needed denomination-wise, and places the indent with the various presses through the Government of India. The notes received from the presses are issued and a reserve stock maintained. Notes received from banks and currency chests are examined. Notes fit for circulation are reissued and the others (soiled and mutilated) are destroyed so as to maintain the quality of notes in circulation. The Reserve Bank derives its role in currency management on the basis of the Reserve Bank of India Act, 1934.

b) To facilitate the distribution of notes and rupee coins, the Reserve Bank has authorised selected branches of banks to establish currency chests. These are actually storehouses where bank notes and rupee coins are stocked on behalf of the Reserve Bank. At present, there are over 4368 currency chests. The currency chest branches are expected to distribute notes and rupee coins to other bank branches in their area of operation.

B) Can reserve bank of India or Indian government bodies decide to print additional currencies to meet public expenditure ?

a) The Reserve Bank estimates the demand for bank notes on the basis of the growth rate of the economy, the replacement demand and reserve requirements by using statistical models. The Reserve Bank decides upon the volume and value of bank notes to be printed. The quantum of bank notes that needs to be printed broadly depends on the annual increase in bank notes required for circulation purposes, replacement of soiled notes and reserve requirements.

b) The Government of India decides upon the quantity of coins to be minted. The responsibility for coinage vests with Government of India on the basis of the Coinage Act, 1906 as amended from time to time. The designing and minting of coins in various denominations is also attended to by the Government of India

C) Do India need to Deposit some gold in IMF for additional currency printing for meeting the public expenditure.

a) No. Absolutely there is no external foreign or IMF control on the estimation, printing or circulation of Indian rupee notes and coins. But the only external control on the value of Indian money in the international circulation is the “Exchange rate”, with reference to various other national currencies. Indian money is tied to a basket of European currencies (now jointly represented by Euro). The exchange rate parity of rupee fluctuates based on the Indian balance of payment to the world, exports/imports and the parity of Euro in the international market.

b) The gold standard is a monetary system in which the standard economic unit of account is a fixed weight of gold and all currency issuance is to one degree or another regulated by the gold supply. To protect the public and guarantee the nation against any bankruptcy, the RBI keeps a certain percentage of gold in their own safe deposit vault, in proportion to the additional currency minted and directed into the circulation. The quantum percentage of gold kept in the deposit is not exposed in any documents or in the Websites of RBI or the Government of India..

c) In modern mainstream economic thought, a gold standard is considered undesirable because it is associated with the collapse of the world economy in the late 1920's. That aggregated the need for the supply and demand in a far better means of regulating interest rates, money supply and monetary basis. However, many other theories have been advanced for the turbulent economic conditions that existed at this time. While the gold standard is not currently in use, it has advocates for its resurrection and forms part of a basic theory of monetary policy as a standard for comparison for other monetary systems. Advocates of a variety of gold standards argue that gold is the only universal measure of value, that gold standards prevent inflation by preventing the creation of unlimited money supply in a “fiat” currency, and that it provides the soundest theoretical basis for a monetary system.

d) In today’s economics the fiat currency (a legally binding command or decision entered on the court or government record ) or fiat money is money that enjoys legal tender status derived from a declaratory fiat or an authoritative order of

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I have got useful information throug this article
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Other Answers (6)

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  • sreenivasa m answered 6 years ago
    What are your intentions.? Money printing business is a wholesale government business and no private players are allowed in this business.
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  • sH@uN answered 6 years ago
    Well, I wonder what your intent is???
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  • Bobby C answered 6 years ago
    Wow...you asked that question almost like you have a color laser printer sitting right beside you ready to go and all you need is some paper. Before you think about it think again after reading this:
    http://www.pcworld.com/article/118664/go...

    http://www.usatoday.com/tech/news/survei...

    As for printing the dollar, I watched a TV show to see how it was made and read a book when I was a kid. This is what I remember:

    It starts generally with a master die. This die is created by several artists and is created in several sections and not by a single person.
    The master die creates plates and the master die is stored in a safe deep in some building.
    The plates are put onto a press that can apply many tons of pressure.
    Paper is created either by the mint or a 3rd party authorized to manufacture the "paper", which is generally a durable cloth/paper blend with watermarks and denomination strips created into the paper.
    This special paper is ran through the press through a pressure process and the bills are printed.
    Inspectors account for the printed bills and the quality of the bills.
    The bills are cut and wrapped.
    The bills are inspected again.
    The bills are distributed to banks; they may replace old and worn bills that the banks submitted to the Fed and the Fed pulled from circulation.

    No one person knows every part of the process or is part of the whole process from start to finish.

    Websites:

    http://videos.howstuffworks.com/howstuff...

    http://www.moneymuseum.com/standard_engl...

    http://library.thinkquest.org/5395/How_m...

    http://en.wikipedia.org/wiki/Euro_bankno...

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  • Suyog G answered 6 years ago
    I think a printing machine is used..
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  • noxiousjithin answered 6 years ago
    Y do u want to print money?
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  • Ultimate Warrior answered 6 years ago
    I totally agree with Suyog here....there might b some printing machine for it.... but its not simple as Xerox machines that we use for scanning and printing...its indeed HI-FI machine .... indeed very very complicated one ..... i think you got ur answer now :)
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