Lok Sabha Question No. 2293 (UNSTARRED), answered on 2017-07-28
Subject: Fake Currency and Demonetisation
Ministry: FINANCE
Asked by: KURUPPASSERY VARKEY THOMAS, RAYAPATI SAMBASIVA RAO, MAULANA BADRUDDIN AJMAL, RAMESH CHANDER KAUSHIK

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS LOK SABHA

## UNSTARRED QUESTION NO. 2293

TO BE ANSWERED ON 28 TH  JULY, 2017/6 TH  SHRAVANA SAKA, 1939

## Fake Currency and Demonetisation

## 2293.   PROF. K.V. THOMAS:

SHRI RAYAPATI SAMBASIVA RAO: SHRI BADRUDDIN AJMAL: SHRI RAMESH CHANDER KAUSHIK:

## QUESTION

Will the Minister of Finance be pleased to state:

- (a) the  details  of  fake  currency  recovered  along  with  the  number  of  fraud  accounts identified during the course of demonetisation;
- (b) whether the Government has come across fake currency in the new denomination notes of Rs. 2000 and Rs. 500 being pushed in Indian markets, if so, the details thereof along with the steps taken by the Government to curb fake currency in the new  denomination notes including its circulation through Automated  Teller Machines;
- (c) whether the Government has evaluated the impact/outcome of demonetisation on the economy and the people, if so, the details thereof and if not, the reasons therefor; and
- (d) whether the Government proposes to implement demonetisation again, if so, the details thereof and the reasons therefor?

## ANSWER MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (SHRI ARJUN RAM MEGHWAL )

- (a) The Specified Banknotes in the denomination of Rs. 500 and Rs. 1000 returned to RBI are being verified for authenticity on Currency Verification and Processing Systems. The details regarding amount of fake currency recovered during the course of demomonetisation may be available on completion of the verification process.

Operation Clean Money was launched on 31 st  January 2017 with the mission to ' Create  a  tax compliant  society  through a fair, transparent and  non-intrusive  tax administration where every Indian takes pride in paying taxes '.  In  the process, about 18 lakh persons were identified whose cash transactions did not appear in line with their tax profile. Such persons were approached through SMS/email (non-intrusive method without even a notice) .The contacted persons were required to submit their responses by logging into a specified website. As an outcome, more than 9.27 lakh responses were received providing information on 13.33 lakh accounts involving cash deposits of around Rs.2.89 lakh crores. Appropriate action under direct tax law in the remaining cases has been taken. Subsequently, advance data analytics tools were deployed and 5.56 lakhs new cases were identified for online verification.

(b) The  data  available  from  the  National  Crime  Records  Bureau  indicates  that  the incidents  of  Fake  Indian  Currency  notes  (FICN)  have  been  reported  in  some  parts  of country. However, examination of the specific parameters reveals that the notes are of low quality. No high quality counterfeit new currency notes have been seized by any agency so far.

To  check  the  menace  of  counterfeiting  of  banknotes,  the  Ministry  of  Finance, Ministry of Home Affairs, Reserve Bank of India, Security and Intelligence Agencies of the Centre and States are working in tandem to thwart the illegal activities related to Fake Indian Currency Note (FICN). An FICN Coordination Group (FCORD) has been formed in the Ministry of Home Affairs to share the intelligence/ information amongst different security agencies of Centre/States to counter the menace to effect more seizures. The issue has also been raised in International multilateral fora constantly.

(c) As  the  Economic  Survey,  2016-17  indicated,  over  the  medium  and  long  run, implementation of GST, follow-up to demonetisation and other structural reform measures should help in improving the trend rate of growth of the economy. There are many key economic indicators that have either remained resilient or have bounced back after showing some decline.  Soon  after  demonetisation,  the  sales  of  two-wheelers  that,  to  an  extent, represents the dynamics of rural demand, has picked up again. The agricultural production in 2016-17 was at a record-high. The volume of digital transactions is higher than the predemonetisation levels. The growth of exports, too has, accelerated in the second half of 2016-17.

(d) There is no such proposal.

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