Indian currency is given here. Starting from the old days, now the new age currency is given here.Currency is the primary medium of exchange in the modern world, having long ago replaced bartering as a means of trading goods and services.In the 21st century, a new form of currency has entered the vocabulary, the virtual currency.
Virtual currencies such as bitcoins have no physical existence or government backing and are traded and stored in electronic form.A key characteristic of modern money is that it is uniformly worthless in itself.
That is, bills are pieces of paper rather than coins made of gold, silver, or bronze. The concept of using paper as a currency may have been developed in China as early as 1000 BC, but the acceptance of a piece of paper in return for something of real value took a long time to catch on.
Modern currencies are issued on paper in various denominations, with fractional issues in the form of coins.Since its Independence in 1947, India has faced two major financial crises and two consequent devaluations of the rupee: In 1966 and 1991.
The price of 16 Annas is 05 rupee in 1947. The demand for decimalisation existed for over a century. Sri Lanka decimalised its rupee in 1869. The Indian Coinage Act was amended in September 1955 for the adoption of a decimal system for coinage. The Act came into force with effect from 1 April 1957.
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The rupee remained unchanged in value and nomenclature. It, however, was now divided into 100 'Paisa' instead of 16 Annas or 64 Pice. For public recognition, the new decimal Paisa was termed 'Naya Paisa' until 1 June 1964 when the term 'Naya' was dropped.
The coins of that period also mentioned their value in terms of the rupee to avoid confusion and cheating. For example, the one paisa coin carried the text "One-hundredth of a Rupee" in Hindi.From 1950, India ran continued trade deficits that increased in magnitude in the 1960s. Furthermore, the Government of India had a budget deficit problem and could not borrow money from abroad or from the private corporate sector, due to that sector's negative savings rate.
As a result, the government issued bonds to the RBI, which increased the money supply, leading to inflation. In 1966, foreign aid, which had hitherto been a key factor in preventing devaluation of the rupee, was finally cut off and India was told it had to liberalise its restrictions on trade before foreign aid would again materialise.
The response was the politically unpopular step of devaluation accompanied by liberalisation. Furthermore, the Indo-Pakistan War of 1965 led the US and other countries friendly towards Pakistan to withdraw foreign aid to India, which necessitated more devaluation.
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Defense spending in 1965/1966 was 24.06% of total expenditure, the highest it has been in the period from 1965 to 1989 (Foundations, pp 195). Another factor leading to devaluation was the drought of 1965/1966 which resulted in a sharp rise in prices.In the period between 2000 and 2007, the Rupee stopped declining and stabilised ranging between 1 $ = Rs 44– Rs 48.
In late 2007, the Indian Rupee reached a record high of 39 Indian national rupee per United States dollars, on account of sustained foreign investment flows into the country. This posed problems for major exporters, IT and BPO firms located in the country who were incurring losses in their earnings given the appreciation in rupee.
The trend has reversed lately with the 2008 world financial crisis as Foreign investors transferred huge sums out to their own countries. Such appreciations were reflected in many currencies, e.g. the British sterling pounds, which had gained value against the dollar and then has lost value again with the recession of 2008.
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