New Delhi, Nov 11 — Security and intelligence agencies have placed law enforcement on high alert to counter a projected surge in counterfeit currency circulation ahead of assembly elections scheduled across seven states between February and December 2027.
Elections are scheduled to be held in Goa, Uttarakhand, Punjab, Manipur, Uttar Pradesh, Himachal Pradesh and Gujarat between February and December 2027.
Intelligence agencies have already sounded an alert and asked security forces to remain on very high alert ahead of the elections. Apart from the threat of terrorist activities in poll-bound states, the agencies have warned of a possible sharp increase in the circulation of fake Indian currency notes.
High-quality counterfeit currency enters India primarily through its borders with Nepal, Pakistan and Bangladesh. The fake notes are largely printed in Pakistan and are so sophisticated that they can sometimes be almost impossible to distinguish from genuine currency. Once they enter the financial system, detecting and removing them becomes extremely difficult, allowing them to remain in circulation.
An official said that, with border security being tightened, those indulging in this racket have changed their modus operandi.
“While producing fake currency in large numbers at home, these elements would look to reduce the quantity that comes in through the border,” the official said.
The fake currency that is produced within India is easier to spot compared with the one that comes in from Pakistan.
Ideally, these smugglers would have preferred having a major chunk of Pakistan-printed fake currency coming into India through the borders. However, given the current level of security, bringing in fake Indian notes in very large quantities would be extremely risky.
An Intelligence Bureau official said the plan was to smuggle counterfeit currency into India in smaller consignments through the borders and then mix it with fake notes printed within the country.
“This would add to the volume, and with the fake notes printed in Pakistan being placed on top, these racketeers hope that detecting the same would be hard,” the official said.
There are also likely to be attempts to expand counterfeit currency printing operations within the country. Over the past couple of months, security agencies in several states have busted multiple such units. In a recent operation, the Uttar Pradesh Special Task Force (STF), along with the Sonia police, busted an illegal currency printing unit in Shravasti district.
The three arrested accused were allegedly planning to exchange counterfeit currency worth Rs 3 lakh for every Rs 1 lakh in genuine notes.
Another official said that many have mastered the art of manufacturing fake Indian currency.
Investigations have revealed that the three accused had watched online videos to learn how to manufacture counterfeit currency. With information on the process readily available on the internet, procuring the materials required to produce fake notes has also become easier. The accused were reportedly using printing machines purchased online to manufacture the counterfeit notes.
“Further, the paper is purchased from persons who have managed to smuggle it from across the border. There is a market within the country that deals only with selling paper for fake currency,” the official said.
The fake currency market usually thrives during the festival season. The sheer volume of money transactions in the commercial establishments makes it easier for these elements to slip in the fake notes. The election season witnesses a spike in such activity.
Election officials and other law enforcement agencies usually dedicate more time to tracking down illicit or black money, apart from the freebies that candidates distribute. The fake currency gangs take advantage of this and try to slip counterfeit notes into the markets.
The Intelligence agencies have warned of a surge of fake currency notes flooding the market during the elections. States where the stakes are high and the elections would be hard-fought would be the primary targets of these elements.
Election authorities are keeping a close watch on candidates and their associates suspected of distributing cash to voters. Intelligence agencies believe counterfeit currency could be pushed into circulation by exploiting such transactions. Voters accepting money in exchange for their votes are unlikely to examine the notes closely or question those handing out the cash, making them vulnerable to being passed counterfeit currency.
The racketeers could exploit this situation by circulating bundles containing a mix of counterfeit notes printed in India and Pakistan, along with genuine currency, an official said.