The federal government has authorized the introduction of 1 billion polymer banknotes of ₹10 and ₹20 for area trials, Parliament was knowledgeable on Tuesday (August 11, 2026).
The Reserve Financial institution of India (RBI), with the advice of its central board, had despatched a proposal to the federal government by way of Part 25 of the Reserve Financial institution of India Act, 1934, for introduction of 1 billion items every of ₹10 and ₹20 polymer banknotes for area trials and for normal issuance of polymer banknotes in these two denominations after profitable completion of area trials, Finance Minister stated in a written reply to the Rajya Sabha.
“The proposal has been authorized by the federal government. As per the RBI, these polymer banknotes are proposed to be issued together with paper substrate-based banknotes,” she stated.
The RBI has knowledgeable that the procurement course of is presently at an preliminary stage, she stated.
Subsequently, she stated, at this level of time, it could not be doable to practicably decide the precise timeframe for introduction of polymer banknotes or the expenditure more likely to be incurred thereon.
Replying to a different query, Ms. Sitharaman stated the typical retail inflation, measured by the Shopper Value Index (CPI), has declined steadily from 5.4% in 2023-24 to 4.6% in 2024-25 and additional to 2.1% in 2025-26.
Owing to the commodity worth shock and elevated international power costs stemming from the West Asia disaster, a seasonal pickup in vegetable costs, and the anticipated unfavourable El Niño situations, retail inflation rose to three.9% in Q1 of 2026-27, she stated.
Nevertheless, she stated, it’s nonetheless under the Reserve Financial institution of India’s inflation goal of 4%.
“The 56th assembly of the Items and Companies Tax (GST) Council has introduced in a two-rate construction with a regular price of 18 per cent, a advantage price of 5 per cent and a particular de-merit price of 40 per cent for a choose few items and companies (however inclusive of earlier compensation cess price, and therefore with no improve in general tax burden),” she stated.
This resulted in rationalisation of charges on many items and companies from 28% to 18%, 18% to 12 or 5%, and from 12% to five%/nil.
As well as, she stated, with a view to cut back enter prices, boosting home manufacturing, selling export competitiveness and supporting strategic sectors, the federal government introduced in Union Price range 2026-27, rationalisation of Primary Customs Responsibility (BCD) on a bunch of products with impact from February 2, 2026.
Extra measures to comprise worth pressures in important commodities embrace a discount in BCD on crude palm oil, crude soybean oil, and crude sunflower oil; a discount within the agriculture infrastructure and improvement cess on masur; and a discount in central excise obligation on petrol and diesel by Rs 10 per litre in March 2026, she stated.
Along with the reforms in oblique taxes, the federal government has elevated people’ disposable earnings by exempting annual incomes as much as ₹12 lakh (₹12.75 lakh for salaried people, after the usual deduction) from earnings tax.
These measures have supported family consumption, as evidenced by the share of personal ultimate consumption expenditure in GDP remaining broadly secure at 56.5-56.7% (base yr 2022-23), she stated.
Furthermore, as per the newest GDP estimates launched by the Ministry of Statistics and Programme Implementation, per capita Non-public Closing Consumption Expenditure (PFCE) recorded a strong progress of 6.8% in 2025-26, up from 4.8% in 2023-24.
However, she stated, the federal government constantly displays the value state of affairs within the nation and undertakes fiscal, administrative and supply-side measures, as warranted by evolving financial situations, to guard the buying energy of households, significantly low- and middle-income households.
Revealed – August 11, 2026 09:36 pm IST
