Shall We Follow or Lead ?

Hindustan Times ( 13 Sept 2016 ) carries a news report titled :

"  Britain's pound gets new plastic avatar "

It goes on to read :

" It can survive a splash of Claret, a flick of cigar ash, the nip of a bulldog, and even a spin in the washing machine - Britain’s first plastic currency goes into circulation from Tuesday in the hope that it is cleaner, safer and stronger than the current cotton-paper generation of banknotes.

Of the four denominations - 5, 10, 20 and 50 pounds - the first to be introduced in polymer form is the fiver

The 10 and 20-pound notes will be issued in 2017 and 2020 . There are currently no plans to replace the 50-pound note with a polymer version, the Bank of England said.

Bank of England governor Mark Carney said:

“ Polymer marks a major innovation. It is cleaner, safer, and stronger. It is resistant to dirt and moisture, so the note won’t wear out as quickly as the current fivers but will stay in good condition for longer.

It is stronger than paper and can better withstand being repeatedly folded into wallets or scrunched up inside pockets.

Polymer notes are also better for the environment...

Importantly, using polymer means we can incorporate better security features. It allows for see-through panels, coloured foils, detailed metallic images, and a new advance: tactile features 

 ”

Why is Britain in no great hurry to introduce PLASTIC notes for pound 50 and 100 denominations ?

Because , Britain does not have to worry about someone carrying a MILION POUNDS in 100 pound currency notes ( its highest denomination ) in a small brief-case ! That would weigh 11 kg .

( - as against 1.1 kg for carrying a MILLION RUPEES in Rs 1000 currency notes ! )

Now you know why everyone in India , wants to continue with Rs 500 / 1000 currency notes . No chance to discontinue !

But we can still eliminate the scourge of BLACK MONEY / CORRUPTION , while retaining those notes !

WHAT SHOULD  INDIA  DO ?

As I have repeatedly recommended over the past year :

*  Discontinue paper-based currency notes of Rs 500 and Rs 1,000

*  Introduce plastic currency notes of Rs 500 / 1,000 which are embedded with RFID micro-sensors

*  Assign to each such note, a IP V 6.0 address , linked to its unique note number ( Internet of Things ? )

*  Set up a IT-enabled Technology Platform which will constantly monitor any accumulation of Rs 500 / 1000

    RFID embedded notes in excess of Rs ONE CRORE within an area of ONE square meter ( eg: Bank Locker )

*  Plot the density of these notes in real time across streets / cities / states ( Currency Map of India )

*  Track the bulk movement of high denomination notes across the country ( especially during election times )

All other measures to curb BLACK MONEY / CORRUPTION are only an eye-wash ! May be a lack of Political Will ?

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13  Sept  2016

www.hemenparekh.in / blogs