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?
[UPSC Civil Services Exam – 2021 Prelims]
(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3
- Statement 1 is correct as the Governors of the Reserve Bank of India (RBI) are appointed by the government of India for a fixed duration.
- Statement 2 is incorrect because the RBI, established on April 1, 1935, under the Reserve Bank of India Act, 1934, is not a constitutional body. There is no specific provision in the Constitution of India granting the Central Government the authority to issue directives to the RBI in the public interest.
- Statement 3 is correct as the Governor of the RBI serves as the Chief Executive Officer of the central bank and holds the position of the ex-officio Chairman of its Central Board of Directors. The Governor derives his powers from the RBI Act.