Contingency plan to ensure availability of currency in war

The government is chalking out a contingency plan to ensure availability of coins and currency notes and their safe transportation in an event of emergency or war for which there is a proposal to increase the storage capacity of National Bank of Pakistan''s (NBP) treasuries/chests across Pakistan.
Sources told Business Recorder on Thursday that the issue was discussed in a recent meeting of the Finance Committee on Defence Planning convened at the Ministry of Finance.
It has been proposed to update the provisions of a report prepared by the Finance Committee on Defence Planning in 1994 in consultation with the SBP/NBP to ensure safety and transportation of currency in war like-situation. Some amendments in the report have been prepared for the committee.
According to sources, the government may face two difficulties in war like situation. It encompasses transportation of coins and currency/bank notes and storage facilities for reserve stocks of coins and currency bank notes.
To tackle the situation effectively, a proposal is under study that the State Bank of Pakistan may increase the storage capacity of the NBP Chests to meet the increased requirements of coins and currency/bank notes. The provincial district administration will be responsible for providing escort and transport for movement of coins, bullion and currency/bank notes.
Responding to the proposal, sources said that there are nearly 221 NBP Chests, besides SBP Chests, in 15 cities spread all over the country. Presently, sufficient storage capacity is available to accumulate 100 percent additional coins and currency/bank notes for emergency requirements.
Recently, the provincial governments have created several new districts with new headquarters. The provincial government may give instructions to these districts for responsibilities to arrange transportation and provide police escort in case of emergency.
Sources said there is a proposal that two sets of designs of emergency notes of new designs of Rs 5, Rs 10, Rs 100, Rs 1000, and Rs 5000 should be prepared and approved. The engraved plates should be kept ready with the Pakistan Security Printing Corporation during peacetime. The decision as to which design should be printed will be taken only at the time of printing. In case of any Pakistani notes being forged by an enemy during the war, the existing patterns should be demonetised. The emergency design of Rs 20, Rs 50 and Rs 500 denomination notes need not be prepared.
Responding to the proposal, sources gave justification that the new design bank notes have lower size and variety of security features. The old design emergency notes do not keep the size, design, and the updated security features required for the purpose. Besides, the new denominations of Rs 20 and Rs 5000, introduced recently, are not described in the relevant report, which may be included in the same.
According to another proposal, in case of emergency or war, the Finance Division will inform the SBP about the "Stand-by-Stage" procedure. The SBP will advise the provincial governments of the institution of this stage and will caution all the offices of the SBP to remain alert. The offices will caution the heads of districts as well as the chest officers of their areas.
As soon as the information is received, all chest officers including sub-chest officers in the 3 border areas and danger zones shall keep the following arrangements ready:
Sufficient number of boxes necessary for the packing of currency/banknotes and coins; nails, straps, and signed seals; sufficient quantity of kerosene oil, fire-wood and match boxes; chisels and hammers and selection of a place for destruction of currency/bank notes and coins, if required.
Under the proposed precautionary measures, as soon as information is received by the State Bank from Finance Division at the "Precautionary Stage" about the movement of the enemy, it will inform the provincial governments and the offices of the SBP about the situation.
The offices of the SBP will inform the head of districts and the chest officers in the border areas and danger zones, on receipt of the information. The chest officers will pack up all currency/bank notes and coins, exceeding their two weeks requirements, in the boxes, transfer them to their link chest or reserve chest, which ever is nearest. The district co-ordination officer shall provide transport for the purpose.
Responding to this proposal, committee has been informed that the previous name of Central Directorate of State Bank of Pakistan has been changed to State Bank of Pakistan. The nomenclature of Deputy Commissioner has been changed to District co-ordination officer. The above names require updating and have been proposed accordingly.