The federal government has decided to introduce coins of Rs 10 and revise composition of Rs 5 coin by reducing intrinsic value from Rs 3.04 to Rs 2.60 and other features, sources close to Secretary Finance told Business Recorder. The federal government, sources said, in its meeting held on January 17, 2007, approved the change of metal composition of Rs 1, Rs 2 and Rs 5 coins and authorised the State Bank of Pakistan (SBP) to issue the coins with the changed metal composition, diameter, weight and intrinsic value.
The details are as follows: (i) coin Rs 1 pure aluminium, diameter 20 mm, weight Rs 1.75 gram, intrinsic value 37 paisa; (ii) Rs 2 pure aluminium, diameter 22.5 mm, weight 2.60 gram, intrinsic value 56 paisa and ;(iii) Rs 5 coins, copper 79 percent, zinc 20 percent and nickel 01 percent, diameter 24 mm, weight 5 grams and intrinsic value Rs 3.04. 0.2 percent copper is added to the aluminium for improving metallurgical/mechanical properties, the sources added.
The process of minting Rs 5 coins could not be started because the federal government decided to issue Rs 5 banknote at the same time. The composition of Rs 5 coin as approved earlier has not remained cost-effective after a lapse of six years. At present, its intrinsic value is Rs 4.22 which may cross the face value due to escalation of metal price in the international market or due to any further devaluation of Pak rupee. Therefore, it is appropriate that the approved composition of Rs 5 coin may be reviewed so as to enable its relatively cheaper minting, ie, nickel, brass and aluminium, etc.
The sources said, due to the reasons of its value and also due to the fact that life span of a coin is more than twenty years and is recyclable whereas banknote is not, in production of Rs 10 coins is also more cost-effective compared to banknotes.
Keeping in view the scenario, the SBP has proposed to the government that composition of the existing Rs 5 coins may be revised and a new coin of Rs 10 may be introduced as per the following composition: (i) denomination of Rs 5 coin - copper 79 percent - zinc 20 percent - nickel 1 percent - diameter 18.5 mm - weight 3 grams and intrinsic value Rs 2.60; (ii) denomination of coin Rs 10, copper 79 percent - zinc 20 percent - Nickel 1 percent - diameter 25.5 mm - weight 5.5 grams and intrinsic value Rs 5.11.