History of the rupee
[1] In the intermediate times there was no fixed monetary system as reported by the Great Tang Records on the Western Regions.
[5] Sher Shah Suri, during his five-year rule from 1540 to 1545, set up a new civic and military administration and issued a coin of silver, weighing 178 grains, which was also termed Rupiya.
The coins depicting Ram and Sita were issued in both silver and gold; minting ended right after Akbar's death in 1605.
[1] In the intermediate times there is no fixed monetary system as reported by the Da Tang Xi Yu Ji.
[5] During his five-year rule from 1540 to 1546, Sher Shah Suri set up a new civic and military administration and issued a coin of silver, weighing 178 grains, which was also termed the Rupiya.
There are many fake coins of East India Company, with Indian gods depicted on the obverse side as shown in side-bar.
It was only in AD 1717 that the British obtained permission from the Emperor Farrukh Siyar to coin Mughal money at the Bombay mint.
To meet the Home Charges (i.e., expenditure in England) the colonial government had to remit a larger number of rupees due to the ratio change; this necessitated increased taxation and unrest.
The Second World War led to experiments in coinage where the standard rupee was replaced by the "Quaternary Silver Alloy".
The 1955 Indian Coinage (Amendment) Act, that came into force with effect from 1 April 1957, introduced a "Decimal series".
With high inflation in the sixties, small denomination coins which had been made from bronze, nickel-brass, cupro-nickel, and aluminium-bronze were gradually minted in aluminium.
During the World War II, Subhas Chandra Bose led Indian National Army (INA) liberated Mizoram, Manipur and parts of Nagaland from the colonial British control with the help of Japanese forces, British Indian rupee was banned and Japanese rupee (1942–44) was introduced.
During this period almost till mid the 1960s Indian rupee was also a legal tender in Trucial States, Oman, Bahrain and Kuwait.
However since India's trade was largely in Pound sterling it did not register much impact like the two major devaluations of the rupee: In 1966 and 1991 in the face of economic crisis.
As a result, the government issued bonds to the RBI, what increased the money supply, leading to inflation.
Furthermore, the Indo-Pakistan War of 1965 led the US and other countries friendly towards Pakistan to withdraw foreign aid to India, which necessitated more devaluation.
Finally, by the end of 1989, the Indian Rupee had plunged to a then-all-time low of about four British pence (4p).
[15] In 1991, India still had a fixed exchange system, where the rupee was pegged to the value of a basket of currencies of major trading partners.
India started having the balance of payments problems since 1985, and by the end of 1990, it found itself in serious economic trouble.
The government was close to default and its foreign exchange reserves had dried up to the point that India could barely finance three weeks’ worth of imports.
This posed problems for major exporters, IT and BPO firms located in the country who were incurring losses in their earnings given the appreciation in rupee.
The trend reversed with the 2008 world financial crisis as Foreign investors transferred huge sums out to their own countries.
Such appreciations were reflected in many currencies, e.g. the British sterling pounds, which had gained value against the dollar and then has lost value again with the recession of 2008.
Due to stagnant reforms, and declining foreign investment, rupee started depreciating in the early 2013.
He also asked the political parties to help his Government, tide over the crisis that the country was facing with rupee losing its value.
2023 Currency recall In May 2023, the Reserve Bank of India started withdrawing the ₹2,000 notes from circulation.
One among the main reason of removing it from circulation is the low rate of its use to the Indian current market economy[21] and its printing was stopped as of 2018 - 2019.
The Paper Currency Act,1861 gave the Government the monopoly of note issue throughout the vast expanse of British India, which was a considerable task.
The Reserve Bank of India was formally inaugurated on Monday, 1 April 1935 with its Central Office at Calcutta.
The five hundred (₹500) and one thousand rupee notes (₹1,000) were demonetised by an unscheduled address to the nation by Prime Minister Narendra Modi starting from midnight 8 November 2016.
