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Picture Courtesy: https://indianexpress.com/article/business/rbi-applications-deputy-governor-9653539/?ref=business_hp

Context:

The Reserve Bank of India (RBI) has issued an official advertisement seeking applications for the position of Deputy Governor.

About Reserve Bank of India (RBI)

It started operations on 1st April 1935 under the Reserve Bank of India Act 1934. It was nationalized on January 1, 1949.

It is administered by the Union Ministry of Finance and is in charge of controlling, issuing, and maintaining the Indian rupee supply.

It manages the country's major payment systems and works to promote economic growth. The Bharatiya Reserve Bank Note Mudran (BRBNM) is a specialized division of the RBI that prints and mints Indian currency notes (INR) at two of its currency printing presses in Mysore (Karnataka) and Salboni (West Bengal).

Working Structure

The RBI's overall direction is set by the 21-member central board of directors, which includes;

The Governor
4 deputy Governors
2 finance ministry representatives (usually the Economic Affairs Secretary and the Financial Services Secretary)
10 government-nominated directors
4 directors who represent local boards in Mumbai, Kolkata, Chennai, and Delhi.

Eligibility for RBI's Deputy Governor role?

According to the RBI, the candidate's age should not exceed 60 as of January 15, 2025.
Experience requirements:
- - Must have at least 25 years of experience in Public Administration, including experience as a Secretary or equivalent in the Government of India; or
  - Should have minimum 25 years of work experience in an Indian or International Public Financial Institutions; or
  - Should have an exceptional merit and track record at the national or international level in a relevant field.

The salary is Rs2,25,000 (Level 17) and the term of office is three years. The candidate is eligible for re-appointment.

Function of RBI Deputy Governor

They are part of the Monetary Policy Committee, who decide the interest rate and other monetary measures to control inflation and to ensure economic stability.

They monitor, supervise and regulate banks and financial institutions to ensure compilation with banking regulation, maintaining fiscal stability and addressing issues related to non performing assets.

They are involved in the internal management of the RBI and ensure the efficient functioning of the central bank operation.

Michael Patra, an economist, has worked for the RBI since 1985. He was appointed deputy governor in January 2020 for a three-year term as a member of the monetary policy committee (MPC), which was extended by one year.

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Source:

Indian Express

Wikipedia

PRACTICE QUESTION

Q.Consider the following statements in the context of the Monetary Policy Committee:

1. The meetings of the Committee are held at least four times a year.

2. The committee members need to mark a "silent period" of seven days before and after the rate decision.

Which of the above statements is/are correct?

A) 1 only

B) 2 only

C) Both 1 and 2

D) Neither 1 nor 2

Answer: C

Explanation:

Statement 1 is correct:

The Monetary Policy Committee is in charge of setting India's benchmark interest rate. The Monetary Policy Committee meets at least four times a year (specifically, once per quarter), and its decisions are published following each meeting.

Statement 2 is correct:

The committee consists of six members: three Reserve Bank of India officials and three external members nominated by the government of India. They must keep a "silent period" of seven days before and after the rate decision to ensure "utmost confidentiality".