In literal sense, the number of banknotes printed during July 01, 2018 to June 30, 2022 amounted to Rs 7,201,480 million.
However, the literal printing of banknotes does not necessarily mean an increase in the overall cash in the economy by the same quantum.
The main factors that determine the amount of banknote printed by the State Bank of Pakistan (SBP) are the replacement of the soiled and damaged banknotes, maintenance of stock by the SBP and stocks of banknotes held by the commercial banks.
Secondly, in terms of growth in Currency in Circulation (CiC), which increases due to issuance of currency by the SBP against (i) the government cheques drawn on SBP (ii) the banks‘ demand for currency.
Further, natural growth of CiC also occurs due to increased economic activity, the cumulative nominal GDP growth for the period was 53 percent or 23 trillion.
The expansion of currency in circulation during July 01, 2018 to June 30 2022 is as follows:
Thirdly, in the economic sense, the printing of money is broadly defined as the direct borrowing of the government from the Central Bank.
In this regard, the outstanding government borrowing from the State Bank of Pakistan stood at Rs 5.07 trillion at June 30, 2022 as compared to Rs 3.54 trillion at June 30, 2018.
The above information was shared with the National Assembly by the Minister for Finance and Revenue Ishaq Dar on October 14, 2022.
