Consider the following statements : 1. The Governor of the Reserve Bank of India (RBI) is appointed by the Central Government. 2. Certain provisions in the Constitution of India give the Central Government the right to issue directions to the RBI in publi

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Q: (IAS/2021)
Consider the following statements :
1. The Governor of the Reserve Bank of India (RBI) is appointed by the Central Government.
2. Certain provisions in the Constitution of India give the Central Government the right to issue directions to the RBI in public interest.
3. The Governor of the RBI draws his power from the RBI Act.
Which of the above statements are correct?

question_subject: 

Polity

question_exam: 

IAS

stats: 

0,277,210,17,51,277,142

keywords: 

{'rbi act': [0, 0, 0, 1], 'rbi': [1, 4, 2, 23], 'governor': [5, 1, 0, 6], 'reserve bank': [1, 0, 3, 4], 'central government': [1, 0, 0, 1], 'constitution': [39, 3, 11, 39], 'certain provisions': [0, 0, 0, 2], 'public interest': [1, 0, 0, 1], 'power': [24, 3, 21, 61]}

The correct answer is option 3, which states that statements 1 and 3 are correct.

In Statement 1, it correctly notes that the Governor of the Reserve Bank of India (RBI) is appointed by the Central Government. The RBI falls under the jurisdiction of the Ministry of Finance, and its top officials, including the Governor, are appointed by the Central Government.

Statement 2 is incorrect. While the Central Government does have a role in the operation of the RBI, there are no specific provisions in the Constitution that allow it to issue directives to the RBI in public interest. The RBI`s functions and responsibilities are outlined in the RBI Act of 1934, not the Constitution.

Statement 3 is correct. The RBI Act of 1934 is the legislative act under which the Reserve Bank of India was formed. This Act provides the framework for the operation of the RBI and outlines its duties and powers, including the powers of the RBI Governor. Hence the Governor of the RBI indeed draws his power from the RBI Act.