RBI, which manages the supply, adjusted the entire coin indent plan for FY19 by raising the demand for smaller denomination of coins in lieu of Rs 10 coins, following India Government Mints’ failure to procure Rs 10 coin blocks on time, according to official documents.
The Security Printing & Minting Corporation of India (SPMCIL), which controls four government minting units – in Kolkata, Mumbai, Hyderabad and Noida – had told RBI in August that it had no option but to revise the denomination wise production plan due to “unavoidable delays in procurement of Rs 5 and Rs 10 coin blocks”.
Accordingly, the four units under SPMCIL are told to mint 200 crore pieces of Rs 10 coin, instead of previous indent of 400 crore pieces. was discussed at a production planning meeting at Department of Economic Affairs on October 3 where representatives from RBI were present.
“Ministry has since ratified the indent as requested by SPMCIL and accepted by RBI,” the Corporation said in a communication to the heads of four minting units on October 4.
ET has reviewed the letter.
This change could disrupt RBI’s coin management plan, people close to RBI’s currency management system said. The central bank was in favour of growing the circulation of Rs 10 coins, the highest-denomination coin minted in India since its introduction in 2005, amid persistent high inflation over long time, one person said on the condition of anonymity.
Even in FY18, RBI had indented 300 crore pieces of Rs 10 coin but due to logistic issues, the mints had supplied merely 76 crore pieces. At the end of March, 505 crore pieces of Rs 10 coin were in circulation.
Under the revised plan which was approved by the monetary authority, SPMCIL told the minting units to raise the production of Rs 5 coins to 113.2 crore pieces, instead of 100 crore pieces ordered earlier. It also raised the demand for Rs 2 coins by nearly five folds to 100 crore pieces against 11.3 crore pieces, and ordered 200 crore of Rs 1 coins instead of earlier demand of 101.9 crore.
“India Government Mints are requested to make all efforts to achieve the above denomination wise production targets,” SPMCIL said in the letter mentioned earlier. The Mints, in turn, have asked its workers to work 54 hours per week, instead of 44-48 hours from October 6 to March 31, 2019. The workers will be eligible for overtime benefits and other allowances, according to office memo put up by all the four mints.