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Nepal's Currency Crisis: How China Monopolized Banknote Printing for 3 Years

A Chinese state-owned company has effectively monopolized Nepal's currency printing for nearly three years. The China Banknote Printing and Minting Corporation has won seven consecutive bids from Nepal's central bank since 2022. This represents a significant shift from previous patterns where Indian companies frequently secured these contracts. The Chinese firm is set to earn approximately $63 million while printing billions of Nepalese rupee notes across all denominations.

Key Points: China Monopolizes Nepal Banknote Printing With Seven Consecutive Wins

  • China Banknote Printing wins 7 consecutive bids over three-year period
  • Chinese firm to earn $63 million printing 2.38 billion banknotes
  • Last Indian contract awarded in January 2023 for NPR 50 notes
  • Latest contract for 430 million NPR 1,000 notes worth $16.985 million
3 min read

Chinese company monopolises printing of Nepal's banknotes for nearly three years

Chinese state-owned company wins 7 straight bids to print Nepal's currency, securing $63 million in contracts while replacing Indian printing firms in strategic shift.

"The Chinese company was selected as the substantially responsive, lowest evaluated bidder - Nepal Rastra Bank notice"

Kathmandu, Nov 7

China Banknote Printing and Minting Corporation appears to be monopolising the printing of Nepal's banknotes, with the Chinese state-owned company winning bids seven times consecutively over the past three years.

On Friday, Nepal Rastra Bank (NRB), the central bank of the country, issued a letter of intent to award a contract to the Chinese company for the design, printing, supply, and delivery of 430 million pieces of NPR 1,000 denomination banknotes worth US$16.985 million.

According to the NRB's notice, the Chinese company was selected as the substantially responsive, lowest evaluated bidder.

In nearly past three years, NRB has issued seven separate tenders for the design, printing, supply, and delivery of various denominations of banknotes. In each case, the Beijing-based company, located in the Xicheng District, emerged as the winning bidder.

Based on the contracts awarded during this period, the Chinese company is expected to earn around US$63 million from Nepal for printing approximately 2.38 billion pieces of banknotes.

The Chinese company does not have a long history of printing Nepal's currency notes. In 2016, the Chinese company had secured the contract to print Nepal's banknotes for the first time, according to the NRB.

On October 15 this year, NRB issued a letter of intent to print and supply 420 million pieces of NPR 50 denomination banknotes and related services. Its bid price of US$10.422 million was accepted as the lowest evaluated bid, according to the central bank's notice.

Earlier, on June 22 this year, the same company was awarded a contract for the design, printing, supply, and delivery of 230 million pieces of NPR 500 denomination banknotes and related services. Its bid price of US$9.66 million was accepted as the substantially responsive, lowest evaluated bid.

On October 27 last year, the Chinese company won another bid to print Nepal's banknotes. It was awarded the contract for printing and supplying 300 million pieces of NPR 100 denomination notes for US$8.996 million.

Similarly, on October 8 last year, the company won the bid to design, print, and supply 340 million pieces of NPR 10 denomination banknotes. It was awarded the contract for US$7.117 million as the lowest evaluated bidder.

Earlier, on July 10 last year, the company secured the contract for the design, printing, supply, and delivery of 350 million pieces of NPR 5 denomination banknotes at a bid price of US$5.158 million, which was also accepted as the lowest evaluated bid.

Likewise, on February 12, 2023, NRB issued a letter of intent to award the company a contract for the design, printing, supply, and delivery of 310 million pieces of NPR 20 denomination banknotes for US$4.698 million.

The last time an Indian company received a similar contract was on January 10, 2023, when NRB issued a letter of intent to award the Security Printing and Minting Corporation of India Limited a contract for the design, printing, supply, and delivery of 300 million pieces of NPR 50 denomination banknotes for US$5.048 million.

Earlier, on November 30, 2022, the same Indian company had been awarded a contract to print and supply 430 million pieces of NPR 1,000 denomination circulation banknotes for US$11.134 million.

- IANS

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Reader Comments

P
Priya S
While China is offering lower prices, we must consider the long-term implications. Currency printing is a matter of national security for any country. Hope Nepal maintains multiple partners for this critical service.
A
Aman W
Honestly, if China is offering better prices and quality, why shouldn't Nepal go with them? This is business, not politics. Our Indian companies need to step up their game and be more competitive. 💰
S
Sarah B
As someone who has worked in international trade, this is classic Chinese strategy - offer unbeatable prices initially to establish monopoly. Once they're the only option, prices will rise. Nepal should be cautious.
V
Vikram M
The numbers speak for themselves - $63 million contract! Our Indian printing corporation lost significant business. We need to understand why we're losing these bids to Chinese competitors in our own backyard.
N
Nisha Z
This is worrying for regional stability. China's growing influence in Nepal through such strategic contracts could affect the entire South Asian balance. Hope our government is taking note and responding appropriately.
M
Michael C
Seven consecutive bids won by the same Chinese company does seem like a monopoly situation. While cost is important, Nepal should ensure there's healthy competition in such sensitive sectors. Diversity is key for national security.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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