Consider the following statements:The Governor of the Reserve Bank of India (RBI) is appointed by th

Question

Consider the following statements:The Governor of the Reserve Bank of India (RBI) is appointed by the Central Government.Certain provisions in the Constitution of India give the Central Government the right to issue directions to the RBI in public interest.The Governor of the RBI draws his power from the RBI Act.Which of the above statements are correct?

Accepted Answer

According to Section 8 of RBI ACT 1934: A Governor and (not more than four) Deputy Governors to be appointed by the Central Government. Hence, statement 1 is correct.According to Section 7 of RBI ACT 1934: The Central Government may from time to time give such directions to the Bank as it may, after consultation with the Governor of the Bank, consider necessary in the public interest. There is no such provision in the Constitution of India. Hence, statement 2 is not correct.According to Section 7 of RBI Act 1934: The Governor and in his absence the Deputy Governor nominated by him in this behalf, shall also have powers of general superintendence and direction of the affairs and the business of the Bank, and may exercise all powers and do all acts and things which may be exercised or done by the Bank. Hence, statement 3 is correct.