The Indian currency is recognized as the official monetary unit of India. The symbol used to represent the Indian currency is “₹”. The term rupee is derived from the Sanskrit word Rupiya which means "image". In ancient times, it was referred to as such as it was valued based on weight, with one rupee weighing 113 grams, compared to an average silver coin weighing 62 grams during that period.
Before the ban on ₹500 and ₹1000 notes, the Indian economy Was largely dependent on cash, leading to the proliferation of counterfeit currency by criminals. To combat this, the RBI has regularly updated and upgraded the security features of INR notes. Typically, high-denomination bills are the most commonly forged. In this blog, we will let you know more about the Indian currency and its importance.
What is the Indian Rupee?
Indian Rupee refers to the national currency of India, denoted by ISO code INR. It is regulated by the country's central bank, the Reserve Bank of India (RBI). The Indian Rupee is named after the rupiah, the first silver coin minted in the 16th century.
India's financial system was traditionally reliant on cash, which led to the proliferation of fake currency by criminal elements. Consequently, the Reserve Bank of India (RBI) has had to periodically enhance the security features of INR notes. Typically, the higher denominations are the most commonly counterfeited.
History Of Indian Currency
Before the emergence of currency, the Barter system was the primary means of exchanging goods and services. As time progressed, this system was supplanted by various types of currency. Cowrie shells were the first form of currency utilized by early humans, with their initial use dating back to 1200 BC. Subsequently, other forms of currency such as Coins and Notes were introduced.
In the Indian context, the term rupee is derived from the Sanskrit word “Rupya", which denotes a silver or shaped coin. The history of the rupee can be traced back to the 6th century BC, when ancient Indians, along with their Chinese and Lydian counterparts from the Middle East, were among the earliest issuers of coins. At the start of 1830, the British had a considerable impact on India. The Coinage Act of 1835 facilitated the standardization of currency across the country. The new coins featured the image of William IV on one side and the denomination in Persian and English on the other.
From 1840 onward, coins displayed a portrait of Queen Victoria. The first coin issued under the crown was authorized in 1862. The Coinage Act of India, which regulates the establishment of mints and the issuance of coins, was passed in 1906 and is still in effect today. Traditionally, the Rupiya was a silver coin. This had significant implications in the 19th century when the world's major economies were on the gold standard. The discovery of large amounts of silver in the European colonies and the US led to the panic of 1873.
During World War II Quaternary Silver Alloy replaced the regular rupee. The coins produced in 1940 were replaced by pure nickel coins in 1947. India gained independence on August 15, 1947, but the existing currency remained unchanged until January 26, 1950, when the country adopted its constitution. In 1957, India introduced a decimal currency scheme where 100 paise made up a rupee.
As earlier in 2016, the government decided to demonetize 500 and 1000 INR notes, stating that it would help to combat the underground economy and make it more difficult for criminals and terrorists to use illicit and counterfeit cash. Following this move, the RBI introduced new notes of denominations of 500 and 2000 INR in the Mahatma Gandhi series.
Who Minted The First Coin And Sher Shah Suri With Rupiya?
The Mahajanapadas were responsible for producing the earliest coins in India during the 6th century BC. These coins were of an irregular shape and made of silver, referred to as Puranas, Karshapanas, or Pana. They were punched to create the desired shape and weight.
Later on, the Mauryan kingdom introduced punch-marked coins made from silver, gold, copper, and lead. Chanakya, who served as the prime minister to the first Mauryan emperor Chandra Gupta Maurya, gave these coins specific names. Silver coins were called Rupya, gold coins were known as suvarnarupa, copper coins were called tamara rupa, and lead coins were referred to as sisarupa. Rupya in this context refers to the shape of the metal used to make the coins.
Between 1540 and 1545, a 178-gram silver coin called Rupiah was issued by Sultan Sher Shah Suri. Since then, the coin has been used in Mughal, Maratha, and British India. Even in the early days of British India, the rupiah issued by Sher Shah Suri was still popular. .
The dam was a tiny copper coin in India, initially introduced by Sher Shah Suri during his reign from 1540 to 1545. It was accompanied by the gold coin Mohur and the silver coin Rupiya. The Mughal Emperors later standardized the coin, along with other silver (Rupiya) and gold (Mohur) coins, to unify the monetary system throughout India. A rupee was divided into 40 dams and it is believed that this coin might be one of the origins of the English phrase "I don't give a damn″, owing to its insignificant value.
Indian Currency After Independence
The Anna series appeared on August 15, 1950. This was the first coin of the Republic of India. The image of the king was replaced by the lion capital of Ashoka. A sheaf of corn replaced his one rupee tiger. The rupee is now divided into 100 "paisas" instead of 16 annas or 64 paisas. "Nay Pise" coins were minted in denominations of 1, 2, 5, 10, 20, and 50 Nay Pies. Both the Anna series. High inflation in the 1960s led to the gradual minting of small coins made of bronze, nickel-brass, copper-nickel, and aluminum-bronze in aluminum. This change began with the introduction of the new hexagonal 3-paise coin the 20 Paise coin was introduced in 1968, but it did not become widespread.
Over time, cost-effectiveness considerations, the 1, 2, and 3 Paise coins were phased out in the 1970s. In 1988 and 1992 his 10, 25, and 50 paise stainless steel coins from 1 rupee were introduced.
Indian Currency And Its Value
As of 10th of November 2016 banknotes include Mahatma Gandhi Old Series denominations 5 INR, 10 INR, 20 INR, 50 INR, 100 INR, and 10 INR, 20 INR, 50 INR, 100 INR, and 200 INR. It was INR, 500 INR, and 2000 INR Mahatma Gandhi's new series of notes. The new series of INR banknotes features various micro-printed texts such as 'Bharata' and 'RBI' in various locations.
However, the RBI actively trades in its USD/INR FX market, influencing exchange rates. As a result, the existing monetary system is the regulated exchange rate of the INR compared to the US dollar. Often referred to as a "managed float".Other exchange rates such as INR/JPY and EUR/INR are subject to the fluctuations characteristic of floating exchange rates. This creates arbitrage opportunities for exchange rates.
The value of the Indian rupee against the US dollar ($) at independence was only 3.3 rupees. It is currently celebrating its 75th anniversary of independence and the value of the rupee against the US dollar is 82.55 rupees. Since independence, the value of the rupee has steadily declined. There are many reasons for the devaluation, but the main reason is that imports into India outnumber exports from India, resulting in a negative balance of payments for the country.
Facts About Indian Currency
Vietnam is the only country with the highest value of the Indian Rupee.
Kuwait Her Dinar is the country with the lowest value of the Indian Rupee.
The Government of India can mint coins in denominations up to 1,000 rupees
A higher denomination that may be permitted by RBI is ₹1,000
Banknotes are made from 100% cotton.
RBI printed the 5,000 and 10,000 denominations in 1938 and demonstrated these in late 1946. The notebook was reintroduced in 1954 and demonstrated again in 1978.
Conclusion And Countries Have The Strongest Value Of The Indian Rupee
We all have dream destinations to visit and great memories of our lives, but the high costs associated with traveling to other countries discourage us. We believe that India's currency is weak only when compared to other well-known countries. But what if we told you that India's currency is so strong that a few countries have casually increased their purchasing power like Vietnam, Indonesia, Uzbekistan, Laos, Paraguay, etc. As you read, this blog contains information about the Indian currency and its history, as well as other interesting facts about the Rupee and its value compared to other countries. Despite the depreciation of the Indian Rupee compared to some foreign currencies, it had value and prestige during ancient Indian times.