CENTRAL BANK DIGITAL CURRENCY (CBDC) AND CONSTITUTIONAL RIGHTS: PRIVACY, SURVEILLANCE, AND FINANCIAL FREEDOM

This paper explores how India’s proposed Central Bank Digital Currency (CBDC), known as the Digital Rupee, could reshape the country’s financial and constitutional landscape. Introduced as part of the Reserve Bank of India’s drive toward a more inclusive and efficient economy, the CBDC also raises serious questions about privacy, individual freedom, and equality. Unlike cash, digital money leaves behind a trace, giving rise to fears of state surveillance and loss of financial autonomy. Using constitutional principles from landmark judgments such as Justice K.S. Puttaswamy v. Union of India, the paper analyses whether the Digital Rupee can coexist with the rights guaranteed under Articles 14, 19, and 21 of the Constitution. Drawing comparisons with China’s surveillance-prone digital yuan, the European Union’s privacy-focused digital euro, and the United States’ cautious legislative approach, the study argues for a rights-based model for India. It recommends clear legal safeguards, limited data access, options for anonymous low-value transactions, and parliamentary oversight to ensure democratic accountability. The paper concludes that the success of the Digital Rupee will depend not only on technological innovation but also on how well it upholds the constitutional values of privacy, dignity, and liberty.