Contact Your Financial Adviser Money Making MC
14 December 2018
 |
RBI
(The Total Investment & Insurance Solutions)
Finance
Minister Arun Jaitley on Friday said sovereign government flagging issues of
credit and liquidity does not infringe on the Reserve Bank's autonomy and hoped
things will work out with the central bank in future. On a day when the board
of Reserve Bank of India (RBI) under its new Governor Shaktikanta Das bought
more time to review the government's demand for a greater say in the central
bank's functioning, Jaitley said the government respects RBI's
autonomy.
"Of course, the government respects the
autonomy of the central bank and because we respect the autonomy of the central
bank that is why we told them... these are the problems that the market is
facing," he said at the annual general meeting of industry body FICCI here.
He said the problems were pointed to the RBI
as they lied within its power, domain and jurisdiction."I can't conceive
how an elected sovereign government bringing to the notice and flagging the
issue of credit and liquidity can in anyway infringe the autonomy," he
said adding if there is a scarcity of capital in the market it has to be told
to the concerned authority. The Total
Investment & Insurance Solutions
The RBI board under former bureaucrat Das
Friday deliberated on the governance framework of the central bank and decided
that the matter required further examination, the RBI said in a statement after
the meeting in Mumbai. The Total
Investment & Insurance Solutions
The government had appointed Das within a day
of Urjit Patel abruptly resigning as Governor after clashing with the
government over parting with RBI's reserves and demands to ease lending curbs.
Jaitley said not just the government but industry associations like FICCI too
should have gone to the Reserve Bank to narrate the challenges facing the
market.
"We don't need, in the current global
situation, another domestic challenge (of credit and liquidity that can hamper
growth)," he said. "A communication and dialogue and bringing to the
notice of the empowered authority is a part of the manner in which economic
systems work." Autonomy, he said, is not synonymous with isolation.
"And that is why this whole debate, public discourse went in a direction
where telling the concerned institution that these are the issues to be flagged
and this is where the challenge has to be addressed can't be an aberration,
it's a necessity," he said.
"I do hope that things will work out
well in future." RBI's 18-member board, which includes government
representatives and industrialists, also reviewed matters relating to liquidity
and credit delivery to the economy, besides discussing the current economic
situation, global and domestic challenges, the central bank said in the
statement. The Total Investment &
Insurance Solutions
On the agenda for the meeting was
re-constituting or reviewing the sub-committees of the board which make
regulatory decisions, in a bid to curb the RBI's unilateral decision-making
powers. The RBI at present decides the regulatory and operational issues of
banks and informs the board later. The RBI under former Governor Patel had
placed restrictions on some weak banks from lending and kept a tight leash on
liquidity. The Total Investment &
Insurance Solutions
Jaitley
had on Thursday defended the government's demands that include further
liquidity for non-banking finance companies (NBFCs) and easy lending rules,
saying there was a need to boost credit and liquidity. Bringing up the
issues facing the economy with the central bank in no way infringes upon the
RBI's autonomy, he said. The Total
Investment & Insurance Solutions
No comments:
Post a Comment