Indian Banknote Firm Eyes Global Growth

‘Make in India’, the long-running government-sponsored initiative to ‘on-shore’ production and reduce imports, is now resulting in Indian entities becoming global providers.

And whether originally planned or not, India’s march towards achieving self-reliance in the manufacture of all critical raw materials used in printing banknotes is entering a new phase as the government banknote printer and mint Security Printing and Minting Corporation of India Ltd (SPMCIL) is now actively targeting exports.

SPMCIL has recently won the contract to print 430 million Rs 1,000 and 300 million Rs 50 banknotes for Nepal, and has participated in various bids at other issuing authorities, signifying its global plans.

An invitation for bids for consultants/agencies to represent it globally for procurement related to banknotes, coins, excise labels, passports, security paper, security ink and other products tells a similar story. (Ref No: SPMCIL-16019/2/2022-MARKETING-SPMCIL/793. The deadline for bids is 28 July 2023).

This comes after one of its subsidiaries, Security Paper Mill, Narmadapuram, invited expressions of interest to set up a manufacturing unit for banknote security thread for domestic consumption and export. (see CN April 2023).

SPMCIL manufactures currency/security paper, security ink, commemorative and circulating coins and banknotes, along with a range of other government documents. It has a total of nine units, including four mints (based in Kolkata, Hyderabad, Mumbai and Noida), two security printworks (in Nashik and Hyderbabd) and two banknote printworks (in Nashik and Dewas) and the above mentioned paper mill in Narmadapuram.

Together these units have the capacity to produce 12,000 tonnes of banknote paper, 10 billion banknotes and 9.7 billion coins a year. Currently, it produces approximately 40% of India’s banknotes (the rest is produced by Bharatiya Reserve Bank Note Mudran Pvt Ltd, BRBNMPL, owned by the Reserve Bank of India). In FY 2022, it produced just under 8 billion banknotes, 784 million coins, nearly 7,500 tonnes of banknote paper, and 450 tonnes of security ink.

While it is currently printing near total capacity for banknotes, it needs proper utilisation of production at its mints. In 2022 alone, SPMCIL could have leveraged the spare capacity of 8.6 billion coins for export orders.

In addition to its own capacity, SPMCIL has access to additional capacity from its joint venture company Bank Note Paper Mill India Pvt Ltd (BNPMIPL) of 12,000 tonnes of paper annually. Along with access to Varnika, the ink manufacturing unit of BRBNMPL. With an annual capacity of 1,500 tonnes, it has been operational since 2022 and produces sufficient ink to meet the country’s requirements.

Furthermore, after becoming self-reliant on the paper and security ink front, SPMCIL’s joint venture BNPMIPL plans to construct a new banknote paper mill at a cost of INR 25 billion ($310 million).

It has long been predicted that the locus of banknote production, traditionally centred in Europe, will move East. The Indonesian and Korean state printers Perum Peruri and KOMSCO respectively have already established their footprint in export. The aim of both China Banknote Printing and Minting and SPMCIL to become global players too will be interesting to watch.