Will new notes which replace the demonetised currency find itself in circulation soon? Unlikely, if the capacity of all the currency printing presses in the country is taken into account.
The latest calculation, based on capacities of the currency printing presses, shows that replenishment would take around six months.
This is particularly true for the new Rs 500 notes, whose printing, presumably, started after November 10. Till those are replenished in adequate numbers, the "currency pain" would not go away since Rs 2,000 notes are difficult to exchange for lower denominations.
However, enough of the new Rs 2,000 notes may already have been printed, calculations show. The central government had demonetised Rs 500 and Rs 1,000 currency notes on November 8, sending the whole nation into a tizzy. Long queues outside banks have been a daily occurrence since then because enough currency notes are not available with them.
New information gleaned from public sources show that the government may be too optimistic in claiming that "adequate amount" of money would soon be in circulation.
That's because of the limited capacity of the printing presses in the country for such a sudden, huge job. There are four currency presses — one each in Nashik (Maharashtra), Dewas (Madhya Pradesh), Salboni (West Bengal) and Mysuru (Karnataka).
The first two are owned by the central government through the Security Printing and Minting Corporation of India Ltd. According to information available in the Finance Ministry's latest annual report, the yearly currency printing capacity of these two presses is around 40 per cent of the total in the country.
The other two presses — in Salboni and Mysuru — are part of the Bharatiya Reserve Bank Note Mudran Pvt. Ltd. (BRBNMPL), a wholly-owned subsidiary of the Reserve Bank of India (RBI). These two, comprising 60 per cent of the total capacity, can print 16 billion notes in two shifts per year, according to information available on BRBNMPL's website.
In essence, it means that total capacity in the country would be 26.66 billion notes in two shifts. If all three shifts run, as the government says is happening now, the four presses would be able to print 40 billion notes a year, irrespective of the denomination.
There were 15.78 billion notes of Rs 500 denomination in circulation and 6.84 billion notes of Rs 1,000. the machines would not be printing Rs 2,000 notes? Assuming an 80 per cent run (remember Rs 500 and Rs 1,000 comprised 84 per cent of all currencies), the time taken for the new Rs 500 notes, which began printing, presumably, on November 10, would be: 5.9 months.
So, by April-end, one would presume, all the new notes would be in circulation. And, of course, the pain would be longer than the 50 days that Prime Minister Narendra Modi has mentioned.