Finance Minister Nirmala Sitharaman is scheduled to address the post-budget meeting of the RBI's central board on Monday and highlight key points of the Union Budget 2022-23, including the fiscal consolidation roadmap and high capex plan. It has been a custom that the finance minister addresses the RBI board, consisting of RBI Governor and existing four deputy governors, after the Budget. The meeting has been scheduled for February 14 where she would be addressing the board members and talk about announcements made in the Budget to perk up growth hit by three waves of COVID-19, sources said.
The minister is likely to inform the RBI board about the steps taken to contain fiscal deficit and may underline the need for reducing interest rates to promote growth.
'His (Das) approach to work seems that of working as a team with ease in communication.'
The central board of Reserve Bank of India (RBI) has opposed a government move to have control over the central bank's staff-related matters. The proposal to make staff regulations statutory and bring them under the subordinate regulation of Parliament was discussed at RBI's board meeting in Kolkata last week.
The Reserve Bank on Wednesday approved a Rs 2.11 lakh crore dividend payout to the central government for 2023-24, more than double the amount it paid for the previous 2022-23 financial year. The decision was taken at the 608th meeting of the Central Board of Directors of the Reserve Bank of India held under the chairmanship of Governor Shaktikanta Das.
Benchmark stock indices Sensex and Nifty rallied more than 1.6 per cent to close at lifetime high levels on Thursday following buying in banking, oil and auto shares and a record dividend payout by the RBI to the government. Regaining the 75,000 level after its best single-day gain since January 29, the 30-share BSE Sensex closed at all-time peak of 75,418.04, up by 1,196.98 points or 1.61 per cent over the last close.
If indeed we want the board to manage the RBI, probably the government should take a close look at the US Federal Reserve system which has a two-part structure - a central authority in Washington, DC, and a decentralised network of 12 Federal Reserve Banks located throughout the country, says Tamal Bandyopadhyay.
The stimulus package announced by Finance Minister Nirmala Sitharaman "fails to involve" banks in the economic revival process, a member of the Reserve Bank of India's central board said on Wednesday. The stimulus package is "imaginative and forward looking, yet fails to involve banks as frontline warriors in revival of economy," Satish Marathe, a member of RBI's central board, said in a social media post.
Events proved that on every count the RBI had accurately predicted both the damage and the lack of benefit. What the RBI was hiding was the fact that Modi had ignored its concerns -- all of which turned out to be true -- and gone ahead anyway, asserts Aakar Patel.
Finance Minister Nirmala Sitharaman on Saturday said the country's regulators are very experienced and are seized of the matter relating to the Adani Group crisis. The minister was replying to a question on the observations of the Supreme Court on public interest litigations (PILs) alleging exploitation of investors and "artificial crashing" of the Adani Group's stocks. "I will not disclose here what the government will be saying in the court...India's regulators are very, very experienced and they are experts in their domain.
RBI had a board meeting recently.
November 8 marks 6 years after demonetisation. A K Bhattacharya reveals how the prime minister and the RBI worked together for months before Modi's 8 pm speech. A riveting excerpt from The Rise Of Goliath: Twelve Disruptions That Changed India.
The RBI raked in a massive net income gain from foreign exchange currency sales as a buffer for the rupee during tumultuous geopolitical upheavals last year owing to Russia's invasion of Ukraine.
Like other central banks, the Reserve Bank of India is also concerned that spurt in food, commodity and oil prices coupled with fears of US recession could fuel inflation and slow down the economic growth. RBI Governor Y V Reddy and Deputy Governor Rakesh Mohan are also expected to deliberate on the impact of recent policy measures announced by the central bank.
The government has amended its laws to have a bigger say in the decision making of the Reserve Bank of India (RBI) by having two members on the central bank's board as compared to one now.
The RBI was not party to the decision to demonetize 500 and 1,000-rupee notes, which was taken at the highest level of India's political leadership.
'The Jalan Committee has now provided very clear guidelines on how the (RBI's) balance sheet should be looked at, what kind of disclosures should be made, what are the principles on which the Contingency Risk Buffer should be maintained, what should be the revaluation reserves, and the market risk to the Contingency Risk Buffer.'
'They are not tom-tomming what a great thing the Supreme Court decision is.' 'If they say it was a great thing, the public will react because people suffered and are still suffering.'
The RBI Board on Friday approved the transfer of Rs 57,128 crore as surplus to the central government for the accounting year 2019-20, the central bank said in a statement.
The government has proposed "drastic changes" in the rules framed to retune the composition of three committees of the RBI: Board for Financial Supervision, the Board for Payment and Settlement Systems and the Committee of the Central Board.
One thing is for sure: It smacks of the regulator's lack of confidence in the bank's board, points out Tamal Bandyopadhyay.
'For a responsible person like him to utter such nonsense is shameful.' 'He is not fit to be a director on the RBI central board.'
'The critics are getting carried away.' 'The challenge for the RBI is not any erosion of autonomy caused by demonetisation.' 'It's the whole attempt to reduce the RBI's stature and role that has been under way,' says T T Ram Mohan.
'We will infuse the next tranche of recapitalisation by mid-December. Close to Rs 42,000 crore remain to be infused as capital in public sector banks in the current financial year,' a senior finance ministry official said.
'We can go somewhere between 35 per cent and 40 per cent.'
The government wants the RBI to part with most of its profit as dividend.
The BJP member also sought to put the LVB-DBS merger on hold in order to facilitate a forensic audit of the takeover of the assets of both banks.
A high-level panel led by former RBI governor Bimal Jalan, set up to decide the appropriate capital reserves that the central bank should maintain, on Wednesday finalised its report.
The board deliberated on the governance framework of the RBI and it was decided that the matter needs further examination
North Block is concerned that when India is trying to attract more investment, putting up restrictions on audit firms could create an avoidable bad advertisement.
'Only the coming years will tell whether the government finds this an easy way of relieving itself from its fiscal constraints.'
With his strong views on Bharatiya economics, his appointment to the RBI board may well presage interesting times, says Archis Mohan.
'The PCA framework was revised and tightened in April 2017, but there was no discussion in any board meeting. The government does not know the rationale behind revising the framework and how the RBI arrived at it. Similarly, there was no discussion in the board meeting on the revised NPA framework,' said an official.
The Centre's proposal to call for governance reform in the RBI could, however, take a back seat, a source privy to the development said.
Nudging the RBI to cut interest rates to boost growth, Finance Minister Arun Jaitley on Sunday said he had already made his mind clear and hoped the central bank will take decision after taking into account various factors.
'If there is an RBI majority in the committee, there is no question of a veto.'
The finance ministry and the Reserve Bank of India will work together to ensure price stability and benign interest rates in the economy, Finance Minister P Chidambaram said on Saturday.
The agitated workers waved black flags and chanted slogans against him.
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