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STEPS TO BECOME AN RBI GOVERNOR

STEPS TO BECOME AN RBI GOVERNOR

The RBI Governor is "appointed" not elected.

The Governor of Reserve Bank of India is appointed by the Prime Minister’s Office (PMO) on the recommendation of the Union Finance Minister as per Section 8(1) (a) of the Reserve Bank of India Act, 1934. The power to appoint is granted solely to the Central Government under S.8 of the RBI Act. The RBI Governor typically has a term not exceeding 5 years, which can be extended but usually isn’t. The Governor can be removed from office anytime by the Central Government. It suffices to say that s/he holds office at the pleasure of the Central Government. The criteria for choosing a RBI Governor are the same old – economist of high standing, outstanding finance ministry official etc.

The Reserve Bank’s affairs are governed by a Central Board of Directors (CBD). The Central Board of Directors is the main committee of the Central Bank. The Government of India appoints the directors for a 4-year term. The Board consists of a Governor, and not more than 4 Deputy Governors, 15 Directors to represent the regional boards, 2 from the Ministry of Finance and 10 other directors from various fields. Members of the board are appointed by the Government of Indian accordance with Section 8 of the Reserve Bank of India Act. The CBD as the administrative apex body of the RBI contains two sets of directors. First is the official directors and second, non-official directors. The official directors comprised of the Governor and not more than four Deputy Governors who are appointed/nominated by the Central Government under the RBI Act. RBI Governors is thus appointed by the Government. Besides the official directors, there can be fourteen on-official directors as well in the CBD. The government can nominate two government officials into the CBD. The Governor and not more than four Deputy Governors of the RBI are appointed by the Central Government under the RBI Act. RBI Governors is thus appointed by the Government. The Governor and Deputy Governors hold office for periods not exceeding five years. The term of the governor may be fixed by the government at the time of his appointment. (Raghuram Rajan was appointed for three years; though a governor can get five-year tenure). Governor (and also Deputy Governors) is eligible for reappointment or extension.

The usual procedure:

The Appointments Committee is the official vehicle to do the job, but typically, the Prime Minister’s Office chooses the governor with inputs from the Finance Ministry. The Politicians of the ruling party play an important role in the selection but the corporate houses that normally try to influence the appointment of CEOs of commercial banks do not have a voice here. In the 81-year history of RBI, only once was a commercial banker appointed the governor. By tradition, bureaucrats and economists are considered for this post.

Any person with a degree/post graduate/CA can become Governor of RBI provided:
1. He has worked as General Manager/ED/Chairman of a Bank
2. Worked in Finance Dept. of Gov. Of India
3. Worked at IMF/World Bank
4. Has a very good experience in banking and financial institutions.
5. Worked in any world reputed financial/banking organization etc.
6. Nominated by the central board of directors.

Here we, at Kailasha Foundation, are providing you a list of all RBI governors so far along with their tenure:

1 Osborne Smith 1 April 1935 30 June 1937 2 years, 90 days
2 James Braid Taylor 1 July 1937 17 February 1943 5 years, 231 days
3 C. D. Deshmukh 11 August 1943 30 June 1949 5 years, 323 days
4 Benegal Rama Rau 1 July 1949 14 January 1957 7 years, 197 days
5 K. G. Ambegaonkar 14 January 1957 28 February 1957 45 days
6 H. V. R. Iyengar 1 March 1957 28 February 1962 4 years, 364 days
7 P. C. Bhattacharya 1 March 1962 30 June 1967 5 years, 121 days
8 L. K. Jha 1 July 1967 3 May 1970 2 years, 306 days
9 B. N. Adarkar 4 May 1970 15 June 1970 42 days
10 S. Jagannathan 16 June 1970 19 May 1975 4 years, 337 days
11 N. C. Sen Gupta 19 May 1975 19 August 1975 92 days
12 K. R. Puri 20 August 1975 2 May 1977 1 year, 255 days
13 M. Narasimham 3 May 1977 30 November 1977 211 days
14 I. G. Patel 1 December 1977 15 September 1982 4 years, 288 days
15 Manmohan Singh 16 September 1982 14 January 1985 2 years, 120 days
16 Amitav Ghosh 15 January 1985 4 February 1985 20 days
17 R. N. Malhotra 4 February 1985 22 December 1990 5 years, 321 days
18 S. Venkitaramanan 22 December 1990 21 December 1992 1 year, 365 days
19 C. Rangarajan 22 December 1992 21 November 1997 4 years, 334 days
20 Bimal Jalan 22 November 1997 6 September 2003 5 years, 288 days
21 Y. V. Reddy 6 September 2003 5 September 2008 4 years, 365 days
22 D. Subbarao 5 September 2008 4 September 2013 4 years, 364 days
23 Raghuram Rajan 4 September 2013 4 September 2016 3 years, 0 days
24 Urjit Patel 4 September 2016      TILL DATE  ——————-

Sources:

  1. https://www.rbi.org.in/scripts/aboutusdisplay.aspx
  2. https://en.wikipedia.org/wiki/List_of_Governors_of_Reserve_Bank_of_India

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