The main objective of introducing Rs5000 banknote was to provide convenience and facilitate higher value transactions

May 29 - June 04, 2006

The Governor, State Bank of Pakistan, Dr. Shamshad Akhtar, formally launched a new banknote of Rs5000 denomination and a redesigned note of Rs10 at a crowded press conference last week. These new bank notes were released to public from May 27, 2006.

Dr. Shamshad said that it is for the first time in the history of Pakistan that the banknote of Rs5000/- denomination is being introduced.

The Governor however had to face a volley of probing questions as to why the central bank and the government have decided to issue a banknote of larger denomination of Rs5000. There was a feeling that bank notes of larger denomination were being issued on the back of mounting inflationary pressure and possible devaluation of the Rupee. On the sidelines of the press conference people were arguing why the financial managers of Dollar, Pound sterling were adhered to lower denominations for decades and decades.

Dr. Shamshad Akhtar, the Governor State Bank, however, firmly set aside all the questions regarding inflation and devaluation by strongly asserting her point of view that the economy was moving ahead with sound footings.

She was confident that the government has the cushion to overcome the growing trade balance especially from stable home remittances, improved direct foreign investment and the sale proceeds from privatization of the public sector entities.

She also expressed the hope that the result-oriented policies would also help improve exports from Pakistan which in fact the real factor to reduce the trade deficit.

However, on the question of devaluation of rupee, she observed that the central bank has no intention to devalue rupee. Rather, she insisted that inflationary pressures were contained effectively though a tight monetary policy, which has started producing, results.

The main objective of introducing Rs5000 banknote was to provide convenience and facilitate higher value transactions. Issuance of larger denominated note also economizes the expenditure on printing of notes, as higher denomination notes would reduce the consumption of lower denomination notes.

The government as well as the State Bank had decided to issue new designed bank notes with high-tech security features to minimize the possibility of counterfeiting of these notes.

She said that Rs5000/- banknote contain several security features of international standards and now our notes are comparable with Euro and have more security features than US dollars. "The note also contains a special security feature to facilitate the visually impaired persons to easily recognize it" the governor observed.

The newly designed Rs10 banknote also contained a host of security features as compared to the existing Rs10 note.

She said the new notes also depict the architectural heritage of the country. Famous monumental structures of Pakistan- the Khyber Pass, Peshawar, Mohen-jo-Daro, Larkana and Faisal Mosque, Islamabad-have been printed as the vignette at the reverse of Rs10, Rs20 Rs5000 banknote respectively.

With a view to facilitate the handling of new notes, their size has been kept smaller than the existing notes. The width of the new banknote is 65mm as against 73mm of the existing banknote, while the length of new banknote has also been kept smaller than the existing ones, Dr.Akhtar added.

Actually, the central bank has a plan to redesign all the existing bank notes with an emphasis of incorporating more security features at par with international currencies like Dollar or Euro. In fact, the printing and paper quality of our notes is second to none; however, the security features were the gray areas so far.

It may be recalled that new designed Rs20 banknote was issued on August 13, 2005. After the introduction of Rs20 note, the new note of Rs5000 and a redesigned Rs10 note are the latest addition in our currency basket.

Remaining papers of Rs50/- Rs100, Rs500 and Rs1000 would be launched during next fiscal year 2006-07. However, the old designed banknote would continue to remain circulation as a legal tender along with the newly designed notes.

Following are the security features of the newly launched Rs5000/- bank note:

Having a 100 percent cotton base, the newly introduced note is printed in mustard colour with an enlarged watermark. Portrait of Quaid-e-Azam appears at the obverse left of the note. It carries an electrotype watermark. Partially embedded window security threat into the paper runs from top to bottom at the obverse left of the note. Denomination numeral 5000 can be seen in the thread. The thread appears as silver dashes at the obverse of the note. When the note is held against the transmitted light, the metallic thread appears as a line. The security threat appears as yellow and blue fluorescent bands when viewed under ultra-violet light.

The enlarged portrait of Quaid-e-Azam in Sherwani appears at the obverse right of the note.

The National Flag of Pakistan, printed in Optical Variable Ink appears at the obverse right of the note. It changes colours from green to golden and vice versa when the note is viewed from different angles. Anti-scan and anti-copy line patterns appearing at the obverse and the reverse of the note prevent scanning and photo copying of the exact note. Hidden denomination numeral 5000 can also been seen at the obverse right of the Quaid-e-Azam portrait when the note is viewed from different angles.