Question

Why did Indian states have different currencies before independence?

• A. They were autonomous princely states.
• B. The British encouraged diversity.
• C. Different currencies signified the diverse cultures.
• D. Different currencies had different purposes.

Answer 1

The correct option is A They were autonomous princely states.

After independence in 1947, and the accession of the princely states to the new union, the Indian rupee replaced all the different currencies of the various autonomous states.

The currency we use today, the Indian rupee, is accepted as a medium of exchange across India because the currency is authorised by the government of the country. This includes paper notes and coins.