Intelligence Bureau and investigating agencies have established that fake currency funds terror in India. IB officials say there is a whopping Rs 17,000 crore worth of fake currency in circulation in India. While it funds terror organisations, it also helps intensify economic terrorism in the country.

Sameer, one of the accused in the Hyderabad twin blasts, said in his confession and recent narco analysis conducted in Bengaluru [Images] that the notes are printed in Pakistan and routed into India through Bangladesh. He said that it is distributed to the rest of the country from Uttar Pradesh [Images].

Sameer said he was mainly responsible for bringing in people from the across the border to carry out terror attacks in India. Along with the men, large consignments of fake currency too were transported, he added.

What has foxed investigating agencies is that the serial numbers on the seized fake notes were similar those on genuine notes. Moreover the paper and printing quality of the notes have improved in the past few years making it very difficult to spot the fakes.

Majid Bilal, brother of alleged Hyderabad blasts mastermind Shahid Bilal, said during his narco analysis test that it is was compulsory for the men coming in from across the border to carry fake currency with them. He said that the notes were exchanged with agents within India (mostly in Rajasthan, UP and Andhra Pradesh) at a 2:1 ratio. He also said that Rs 5 crore had been spent on the Hyderabad twin blasts and added that all the money came from distribution of fake currency.

An investigating officer probing the Bengaluru blasts says that they are not ruling out the possibility of fake currency being used to fund the blasts. There have been several instances of fake currency being seized in the city. Statistics indicate nearly Rs 1.5 lakh in fake currency is seized every month by the police and handed over to the Reserve Bank of India [Get Quote], so that the notes can be destroyed.