People scoffed when the U.S. Mint ordered Americans not to melt down pennies and nickels a few months ago. Sure, the zinc and copper in the coins had gotten to be worth more than their face value, thanks to the boom in prices of metals and other commodities. But who would go to the trouble? You'd have to melt a zillion coins to make $100, even if you could find a scrap dealer willing to buy. But the Mint feared entrepreneurial metallurgists might cause a penny and nickel shortage.

Here's a BBC story that shows what the Mint feared coming to pass in India. People are melting rupees, converting them into razor blades and smuggling them into Bangladesh. Result: a one-rupee coin is worth 35 rupees once it's converted into male grooming equipment. And no more rupees.

Police in Calcutta say that the recent arrest of a grocer highlights the extent of the problem. They seized what they said was a huge coin-melting unit which he was operating in a run-down shack.

The grocer confessed to melting down tens of thousands of Indian coins into razor blades which were then smuggled into Bangladesh, police said.
To deal with the coin shortage, some tea gardens in the north-eastern state of Assam have resorted to issuing cardboard coin-slips to their workers.

The denomination is marked on these slips and they are used for buying and selling within the gardens. The cardboard coins are the same size as the real ones and their value is marked on them.