The Centre wants to discuss changes to the Reserve Bank of India\u2019s governance structure at a board meeting next month, including setting up some oversight panels, economic secretary Subhash Chandra Garg told a news channel.<\/p>\n
Garg, who is a government nominee for the RBI board, told another television channel that the administration will ask for more interim dividends from the central bank as it seeks to plug gaps in its budget before a general election next year.<\/p>\n
The proposals to discuss governance at the RBI\u2019s December 14 board meeting may further inflame tensions between the finance ministry and central bank. The two have been at loggerheads over issues including the transfer of surplus funds, easing of bad-loan rules and providing liquidity to the shadow-banking sector.<\/p>\n
Signs of a truce emerged at a meeting between the two sides last week, but Garg\u2019s comments suggest the dispute is far from over. \u201cWe should not shy away from discussions or have a fresh look,\u201d Garg said. Any changes to the board\u2019s governance structure shouldn\u2019t be construed as an attempt to control the RBI\u2019s powers, he said.<\/p>\n
The RBI\u2019s board is an advisory body that guides the regulator, leaving decision-making to Governor Urjit Patel and his colleagues. Bloomberg reported earlier this month that the government is proposing changes that will enable closer supervision of the central bank.<\/p>\n
Swaminathan Gurumurthy, a chartered accountant nominated to the RBI board by the government, and other nominees such as Garg and Rajiv Kumar, have recently commented about perceived shortcomings in banking supervision, the flow of credit to industry and the need for easing financial conditions to counter a crisis in the shadow-banking sector. Garg told CNBC that the tight liquidity conditions were a concern and would be discussed at the next board meeting.<\/p>\n
Tensions between the government and the RBI worsened last month when central bank Deputy Governor Viral Acharya delivered a defense of the institution\u2019s autonomy during a lecture. His speech appeared to have been motivated by the government\u2019s threat to invoke Section 7 of the RBI Act, 1934, a never-used provision that allows the government to dictate policy to the RBI on matters of public interest.<\/p>\n
At the previous RBI board meeting last week, the central bank said it would set up a committee to look into its capital framework. Analysts say the dispute between the government of Prime Minister Narendra Modi and the central bank backs the arguments of Modi\u2019s critics who say he has mismanaged the economy and is trampling on independent agencies.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Centre wants to discuss changes to the Reserve Bank of India\u2019s governance structure at a board meeting next month, including setting up some oversight panels, economic secretary Subhash Chandra Garg told a news channel. Garg, who is a government nominee for the RBI board, told another television channel that the administration will ask for […]<\/p>\n","protected":false},"author":1,"featured_media":48340,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[410],"tags":[],"class_list":["post-48339","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/posts\/48339","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/comments?post=48339"}],"version-history":[{"count":1,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/posts\/48339\/revisions"}],"predecessor-version":[{"id":48341,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/posts\/48339\/revisions\/48341"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/media\/48340"}],"wp:attachment":[{"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/media?parent=48339"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/categories?post=48339"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blastingskyhawk.com\/english\/wp-json\/wp\/v2\/tags?post=48339"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}