Finance min invites application for RBI deputy governor post

Subject : Economy

Section: Monetary Policy

Concept :

The finance ministry has initiated the process to appoint a new Reserve Bank deputy governor in place of MK Jain, whose extended term is coming to an end in June.

Selection Process

The applicant should have an experience of 15 years in banking and financial market operations, said a public notice, indicating that candidates from the private sector will also be considered for the appointment.
Also, It may be noted that the Financial Sector Regulatory Appointments Search Committee (FSRASC) is free to identify and recommend any other person also, based on merit, who has not applied for the post.
The committee may also recommend relaxation in the eligibility and qualifications/experience criteria, in respect of outstanding candidates
Traditionally, one of the four deputy governors is from the public sector banking industry. If the government decides to appoint someone from the private sector, it would be a first for the Reserve Bank of India.

Reserve Bank of India – Composition

The Reserve Bank’s affairs are governed by a central board of directors. The board is appointed by the Government of India in keeping with the Reserve Bank of India Act. They are appointed/nominated for a period of four years.

Official Directors

Full-time: Governor and not more than four Deputy Governors
Four Deputy Governors of which two are appointed from outside — one, a commercial banker and the other, an economist.
The remaining two are promoted from within the RBI.

Non-Official Directors

Nominated by Government: ten Directors from various fields and two government Official
Others: four Directors – one each from four local boards.

Financial Sector Regulatory Appointment Search Committee

FSRASC was set up based on the recommendation of the Financial Sector Legislative Reforms Commission as a “standing committee” to “recommend suitable persons for selection of Chairperson and Whole Time and Part Time Members of the financial sector regulators.”
The Finance Ministry’s objective was to adopt a uniform selection process for all financial sector regulators without going into the related issues of tenure, age and qualification.
It is headed by Cabinet Secretary.
Apart from the Cabinet Secretary, who heads it, it includes
- Additional Principal Secretary to the Prime Minister;
- Secretary, Department of Economic Affairs or Department of Financial Services (depending on the administrative role);
- Chairperson of the regulatory authority concerned, and
- Three outside experts.