Pakistan

Pakistan-china ties: Finance ministry to issue commemorative Rs20 coin

Coin to commemorate the 60th anniversary of the establishment of diplomatic relations between Pakistan and China.

Express March 08, 2011

ISLAMABAD: The ministry of finance has approved the issuance of a coin of Rs20 denomination to commemorate the 60th anniversary of the establishment of diplomatic relations between Pakistan and China.

According to a notification issued by the ministry, the coin to be issued by the State Bank of Pakistan (SBP) will weigh 9.5 grammes and its diameter will be 3.3 milimetres. The coin will be issued on May 21. The SBP will release 1,00,000 copies of the coin.

The front side of the coin will depict the crescent and the star with Islami Jamhoria Pakistan embossed beneath it while the other side will have the words Pak-China Friendship 1951-2011 embossed
beneath it.

The Rs20 currency notes currently in circulation will continue to be used as usual at the exchange along with the commemorative coin, the notification said.

Published in The Express Tribune, March 8^th, 2011.

COMMENTS (5)

John | 13 years ago | Reply Usually when Govt issues a limited edition coins, such as only 1,000,000 coins they are promoted and sold at more than the face value of the coins. These coins are not intended for general currency circulation and the limited number of these special issue coins make them nearly impossible to see them in circulation in general transactions. These special issue coins end up as collectable and gets stored in drawers, passed as gifts, etc., although they can be used as legal tender. These special issue coins are generally promoted in the name of patriotism, honor, remembrance etc., as in this case. What will be the special sale price of this Rs.20 coin depends on local demand, and usually they will go for 10 x the face value. Assuming that is the case here, the govt treasury easily gets Rs. 200,000,000. It is kind of issuing special tax of Rs. 200 on million people except in this case million people get these special coins to remember the event. Because Govt is sovereign and has the power to create money, it works to some extent. What the Govt is going to do with the special money varies. Might be used to build roads, or to pay the creditors. Usually it happens to pay the national debts, but occasionally money is raised to build special monuments to remember national history. This is essentially creating money out of thin air to treasury, like printing money. But printing money approach will cause rapid inflation. Where as, in this case, the money is collected from the public by selling special issue coins, kind of tax, so no inflation. But one would ask, what about the Rs.20,000,000 of face value of the coin introduce in the circulation? Is not equal to printing money? In theory, yes. But the limited edition of only 1,000,000 coins which never see it's use in circulation do not cause inflation. The Govt may,depending on how much money it raised can print the money, say 10x the amount. It effectively devalues Rs. 20,000,000 x 9 million rupees. Remember the initial Rs.20,000,000 coin is out of circulation as collectible, so the devaluation is only 9X on 20,000,000 rupees. A very small sum in GDP, and any inflation is negligible. Depending on how serious the inflation caused by additional money printing approach, the central bank can restrict the currency in circulation(monetary policy)-raise the interest rate on loans there by restrict the amount of money in circulation or retire some series of currency notes (no new money printed), so less money in circulation, or Govt can gradually raise tax in the future. Bottom line. When a Govt issues a special coins, it is kind of one time tax, money collected all at once to fix a dire need of fiscal crisis. The impact is none if it is done when the economy is strong and done once in 100 years or so. Otherwise,...............? Not sure of the real intention in this issue, but it is very likely what is discussed. Remember, the coins have no serial number, will never be issued on this theme, will not be in circulation, so hard to keep accounting.

p k saha | 13 years ago | Reply Where is special price of Rs. 200 mentioned? Also the diameter of 3.3 mm appears to be wrong.

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John | 13 years ago | Reply Rs.20,000,000 out of thin air, and special sale price of Rs. 200?, so 10x. Nice job.

p k saha | 13 years ago | Reply But a coin of Rs.10/- was issued on same event in 2009[link text][1] [1]: //http://worldcoingallery.com/countries/coine_cs.php?image=nmc5/137-10r08&desc=Pakistan new 10 Rupees (2008) 1953-2007&src=Salman Yousaf&query=Pakistan 2008

Hamid Siddiqui | 13 years ago | Reply All I will request to the Government of Pakistan, is that please do not finish it on just the words Pak-China Friendship, go for it. Get out of American greedy web, and recognise the friends, like China and Russia, who always have offered the option to be friends.

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