Stung by the NIA raids and demonetisation, the ISI has set up three factories in Pakistan occupied Kashmir to print fake currency.
At the factory, Intelligence Bureau officials say are the mirror copies of the Rs 500 and 2,000 notes which were introduced post demonetisation.
IB sources say that at least 3 units have been set up. It is at a preliminary stage as they have not yet mastered the note fully as yet. Most of the security features have been copied and it is only a matter of time before all security features have been replicated, the officer says.
The ISI has set up two routes to ensure that the currency lands in India. It has now made it a norm that every terrorist infiltrating into the Valley has to carry with them a certain number of notes. The other route it has set up is through Bangladesh.
At the factories the ISI has also high quality machines. The high quality ink and paper that is being used would also make it difficult for the agencies to spot. In a recent report submitted to the Union Home Ministry, the IB had said that the fake Rs 2,000 notes would be harder to spot than the Rs 500 notes.
The notes printed in the PoK factories would be smuggled into Bangladesh. From there it would enter West Bengal through the already existing channels. From there it would be transported by road to Kashmir.