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Millions of Indian coins are being smuggled into neighbouring Bangladesh and turned into razor blades. And that’s creating an acute shortage of coins in many parts of India, officials say.
Police in Calcutta say that the recent arrest of a grocer highlights the extent of the problem. They seized what they said was a huge coin-melting unit which he was operating in a run-down shack.
The grocer confessed to melting down tens of thousands of Indian coins into razor blades which were then smuggled into Bangladesh, police said.
“Our one rupee coin is in fact worth 35 rupees, because we make five to seven blades out of them,” the grocer allegedly told the police. “Bangladeshi smugglers take delivery of the blades at regular intervals.”
‘Do our best’
Indian revenue intelligence officials say millions of coins are finding their way into Bangladesh.
They say they have alerted the paramilitary Border Security Force (BSF) - which is deployed on the India-Bangladesh border - to check the smuggling.
Revenue intelligence officials, who do not wish to be named, say criminals can make five to six blades from a five-rupee coin.
“We are investigating this closely,” said one official posted in north-eastern India.
Earlier, Indian coins were being melted in huge quantities in places like Calcutta.
The mints took corrective action - scaling down the metal content of the coins - but that has not stopped the shortages.
Distributing coins
The authorities have taken various steps to deal with the problem.
In Calcutta alone, India’s central bank - the Reserve Bank of India - has distributed coins worth nearly six million rupees ($150,000) to overcome the shortage in the last two weeks, bank treasurer Nilanjan Saha said.
“We have to accept very soiled notes of one or five rupees, so soiled that the banks will not change it
Agartala resident Sushil Choudhury“
Long queues form outside the bank’s regional office in the city centre every time this happens.
Unscrupulous touts set up makeshift shops and collect as many of the coins as they can, only to sell them later at a premium.
“We stand in long queues but the coins are finished within no time. Those in front pick them up and we can see some of them later selling the coins at a big margin,” complained small trader Nitai Banik, who needs a lot of coins for his retail trade in small garments.
