The RBI union has proposed a Collegium of experts to appoint governors and deputy governors to ensure central bank autonomy and independence.
The collegium should comprise former RBI governors,other prominent central bankers and economists.
The recent resignation of the RBI deputy governor at least six months before his term expired is the trigger for mooting such a proposal.
The union said that collegium can ensure the neutrality, autonomy and independence of the central bank of the country and prevent undesirable political and purposive interference in such matter.
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.
The Board consists of (a)official directors which includes the Governor and up to four Deputy Governors (b)non-official directors who includes up to ten directors from various fields (c)two government officials and (d)one director from each of four local boards of the RBI.
The Governor and Deputy Governors hold office for not more than five years,the ten directors nominated by the government hold office for four years and the government officials are to hold a term on the RBI Board as long as the government sees fit.
The Governor has to call a Board meeting at least six times in a year and at least once each quarter.A meeting can be called if a minimum of four Directors ask the Governor to call a meeting.
The Governor or if for any reason unable to attend,the Deputy Governor authorised by him to vote for him presides the Board meetings.In the event of split votes the Governor has a second or deciding vote.
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