Lalit K Jha
Washington, Feb 8 (PTI) Huge amounts of counterfeitIndian currency, believed to be printed in Pakistan and routedthrough Nepal and Bangladesh, is causing major concern forIndian authorities, a new report by a Washington-based studygroup said today.
The value of the fake currency in circulation isestimated to be USD 9 million in Nepal''s bordering state ofUttar Pradesh alone and the report said that fake currencydealers in Nepal had projected that by 2010 nearly USD 2.2billion worth of fake currency will be in circulation inIndia.
The Global Financial Integrity in its report said thatthe heavy flow of counterfeit notes has led to speculationthat elements in Pakistan are trying to create confusion anddestabilise India. The fake currency money is routed to thecountry through Bangladesh, Thailand and Nepal.
"In India, on the other hand, counterfeit rupees arebecoming a cause for concern. Fake rupees are believed to beprinted in Pakistan and then channeled through Dhaka,Bangladesh and Bangkok, Thailand into Kathmandu," said thereport on ''Transnational Crime in the Developing World''.
The report estimates that illicit trade in "goods,guns, people, and natural resources" is a USD 650 billionenterprise, which most negatively impacts the developingworld.
"Indian authorities estimate that as many as 400million fake rupee notes with a value of some USD 9 millionare in circulation in the state of Uttar Pradesh alone, andfake currency dealers in Nepal projected in 2009 that by 2010nearly 10,000 crores (USD 2.2 billion) of fake currency willbe in circulation in India," the report said.
This heavy inflow of fake currency has led some tospeculate that Pakistani elements are deliberately trying to"create confusion and destabilise India," it said.
The effects of counterfeit currency are mostly felt onthe micro-level when it is circulated from person to person,the report noted, adding that if the fake money is everdiscovered and seized by the authorities, the holder is notreimbursed, thus losing income in the amount printed on thefake bill.
"On the macro level, flooding an economy with fakecurrency can cause inflation and devalue the currency beingcounterfeited. This is why India is worried about the inflowof fake rupees, possibly from Pakistan," the report said.
According to the report, fake euros tend to circulateless around the world, and are found mainly in the euro zone.
As a result, the overall rate of euro forgery isbelieved to be much lower than that of dollars.
Based on seizures, it is believed that 70 per cent ofcounterfeit euros are produced by only three gangs, "all basedin Italy and the Balkans". .