Directorate of Currency to be set up in FinMin

The government today approved the establishment of the Directorate of Currency (DoC) in the Finance Ministry, a step to enhance security features in currency notes in the wake of reports of fake currency doing the rounds.

The Cabinet, which met under the chairmanship of Prime Minister Manmohan Singh, today gave approval to this effect, sources said.

The directorate, to be headed by a Director-General at the rank of additional secretary, will develop domain knowledge for adding security features to currency notes and create a set of people with expertise in the field, they said.

The decision to set up the directorate was taken on the recommendation of a nine-member committee, headed by former bureaucrat Shilabhadra Banerjee. The committee was set up last year to review the entire gamut of issues relating to security of the Indian currency.

The committee recommended that the directorate be set up in the Finance Ministry as a permanent body.

The directorate will have the mandate to monitor and review the best practices around the world and instances of breach of security features in the Indian currency, identify new security features and fund research and development on a continuing basis.

"The efforts of the DOC are expected to substantially contain the counterfeiting of Indian bank notes," Minister of State for Finance Namo Narain Meena had said in Parliament earlier.

The committee had also suggested that emphasis be laid on indigenisation of bank note paper production, security ink and coin plating.

Besides, the committee had recommended exempting currency paper manufactured in India from excise duty and suggested waiving customs duty on imported machinery for producing bank note paper and printing.

It has also called for launching a multimedia awareness campaign by the RBI to educate and help people distinguish between genuine and fake notes.