The Currency Of India
India has a proper currency system since its ancient history. The currency of India is considered among one of the oldest in the world. As far back in the history as the fourth century B.C., the country had its first coins in circulation. The current designation of the currency, Rupee was given by Sher Shah Suri of Sur dynasty. The first rupee consist of 40 copper 'paisa'.
The concept of paper currency was introduced under the aegis of English East India Company. Among the first issuers of the note in India was 'Bank of Hindustan', 'General Bank of Bengal and Bihar' and the 'Bengal Bank'. At the time of British rule in India, the Rupee was divided in 16 parts known as 'annas'. Each 'anna' was further divided into 4 paise. The system continued in the first decade of Indian independence.
The term 'Rupee' is derived form a Sanskrit word which stands for a silver coin. The coin was considered to carry great value until the discovery of large silver mines in the area that today forms United States. Since most of the currencies pegged by the gold standard, the location of immense silver reserves meant increase in its supply and fall in its value. This led to great depreciation in the value of rupee.
By the coming of 1898, the British Crown had acquired total control over Indian territory. The reeling rupee was given a new life when it was brought into the gold standard. The Indian rupee was initially pegged against the Pound Sterling at a price of 1 shilling and 4 pence. This means that a pound was equal to roughly 15 Indian Rupees. Post World War One, the value was increased to 2 shillings making 1 pound equal to 10 Indian rupees. In 1927, the value was again adjusted to 1 shilling and 6 pence. The currency was pegged at the same rate till 1966. In 1966, the Rupee stopped being pegged to the Pound Sterling and started to peg at the U.S. Dollar. One dollar was pegged as equal to 7.5 Indian Rupees. Thia meant that the new pegging led to devaluation of the Indian Rupee. The rupee now became equal to just 11.4 pence of Britain. The pegging only lasted for five years because the US Dollar was devalued in 1971. Today the Indian Rupee is issued by the Reserve Bank of India. It has been given INR as its international currency code as specified in the ISO 4217 specification. The Nepalese Rupee and Bhutanese Ngultrum peg to the Indian Rupee. Most of the new notes feature Mohandas Gandhi though some old notes with the national emblem of India are still in circulation. The currency of India has had one of the most colorful journeys in the history of numismatics.
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