What is the official currency of India?

The Indian Rupee (INR), symbolised by ₹ and issued in coins and notes by the Reserve Bank of India (RBI), is the correct answer as the sole legal tender of the Republic of India. The RBI, established on 1 April 1935 under the Reserve Bank of India Act, 1934, holds the sole authority to issue currency notes in India, apart from the one-rupee note and coins, which are issued by the Ministry of Finance under the Government of India's authority and merely signed by the Finance Secretary. The rupee symbol ₹, based on the Devanagari letter 'र', was officially adopted in 2010, replacing the earlier abbreviation 'Rs.' in formal usage. The three distractors are currencies of India's neighbours that share the historical root word 'rupee' but are entirely separate legal tenders with independent central banks and different exchange values: the Pakistani Rupee is issued by the State Bank of Pakistan, the Nepalese Rupee by Nepal Rastra Bank, and the Sri Lankan Rupee by the Central Bank of Sri Lanka. None of these currencies is legal tender in India, and their exchange rates against the Indian Rupee differ substantially, with the Nepalese Rupee traditionally pegged at a fixed ratio to the Indian Rupee (roughly 1.6 NPR per INR) due to close economic ties, which is itself a frequently tested fact. A common exam confusion arises because several South Asian nations, having shared colonial and cultural history, adopted the word 'rupee' for their currencies, leading candidates to assume interchangeability; however, each is a distinct sovereign currency. Another trap is candidates forgetting that RBI does not issue the one-rupee note, an exception often tested in banking-awareness sections.