However, the RBI and the Finance Ministry’s reliance on exclusive security features, which are “obtained through exclusivity contracts” from foreign firms, will continue, sources said. For two of the most exclusive security features – magnetic security thread and “M Feature” (to ascertain genuineness of currency paper by chemical analysis) – the RBI and Finance Ministry is “completely dependent” on foreign suppliers.

The work on designing and producing high-value currency has been hampered by the absence of an ink chemist in RBI, although there is one at SPMCIL’s Dewas Bank Note Press. Sources familiar with the designing and production of Indian banknotes said that colour running from the new Rs 2,000 notes was “real” and was caused because the “viscous ink did not go through the mandatory 72-hour drying process.”

The sources said that Economic Affairs Secretary Shaktikanta Das was “misleading” when he said that it is “common for new currency notes to lose some colour and that if notes do not lose colour they might be a sign of being fake currency.” Scoffing at Das’ explanation, the sources said that the draining of colour from the new Rs 2,000 notes was the result of not allowing the three days for the ink to dry up.