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MODULE -II:, as the Central Bank of | dj, , , , Chapter 4, , , , _ Policy Framework for RB|, , , , | 4.1 Introduction, , 4.2 Organisational and Operational Framework —, | 43 ~~ Role as a Central Banker, , 44 Regulatory and Promotional role of RBI, 45 Questions
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; be traced back to the recommendations of the Royal, son on Indian Currency and Finance popularly called as, , , , gn ‘RBI started its operations from Ist April 1935 as a, shareholders’ bank, It was nationalised in 1949., , in the post independence era, the RBI has played an important, mie in India’s development. In the initial years the primary, functions were issue of currency notes, banker to the government, and banker to the banks. Over a period of time its functions have, tuliplied and especially after the introduction of LPG in 1991, and technological advancements thereafter, the role has become, Mote crucial to ensure stability and growth of the economy. The, Gbjectives of the central bank as per the preamble to the RBI Act, Was “to regulate the issue of bank notes and the keeping of, Nerves with a view to securing monetary stability in India and, PPerally to operate the currency and credit system of the country, | Pit advantage, to have a modern monetary policy framework to, , , , , , , , , , * the challenge of an increasingly complex economy to, . Price stability while keeping in mind the objective of, a " Along with the traditional functions, developmental, ., & have also been undertaken by the RBI to bring about, Pment of the economy. At present it is a key player in
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ank of India Act 1934 paved the way for, t of the RBI in 1934 and its functioning in 1935, It we, the British government similar to Bank of B lan, as a private shareholders’ bank with contro] in¢ :, the central government, Eventually it was nationalised in, under the Reserve Bank of India, (Transfer to public, ship) Act 1948 and became a fully owned gove ment, } organisation. The central bank’s powers are confirmed by the, p. ‘government through the Banking Regulation Act of 1949. Among, the developing countries, the RBI is the oldest, though younger to, ! the central banks of countries like USA and UK. Initially the, headquarters was at Calcutta. In 1937 it was moved to Bombay., , , , , , , , , , , , , , , , , ,, , Tt has one governor and, , four deputy governors appointed by, - the central government., ae, , tenure of the governor and deputy governors is five, , and they are eligible for reappointment., , r directors with a tenure of 4 years are appointed by the, with a provision to retire them by rotation,, , ], , n other directors are appointed by the government
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constituent of the Board is a government nominee, , by the government usuall, ly the secretary of, try of finance., , , , @ ‘The four Deputy Governors are assigned specific arrears of, , operation and they assist the Governor in discharging the, responsibilities., , et from the Central Board, there are four ao local, , Mumbai and | Chennai. There are five “members in a ‘board, , printed by the central government. Their role is advisory in, _— nature and they perform functions assigned to them by the, Central Board Right from 1935 to till today the RBI had, 'M governors. The first governor of the RBI was Sir Osborne Arkell, Smith, an Australian. The first Indian governor was C. D., Deshmukh and the present governor is Mr. Shaktikanta Das. He is, the 25th Governor of RBI, and he succeeded Dr. Urjit Patel. The, four deputy governors at present are Shri N. S. Vishwanathan,, M-Viral V. Acharya, Shri B. P. Kanungo and Shri M. K, Jain. This, mie institution is independent within the boundaries set by, - Government as stated by the former governor of the, Bly. V, Reddy.
