The government on Saturday sought to clarify that it has in no way infringed upon the autonomy of the Reserve Bank of India and that it “fully respects the independence and autonomy” of the central bank.
This comes a day after the United Forum of Reserve Bank Officers & Employees wrote to RBI Governor Urjit Patel voicing their dissatisfaction about what they perceived was an impingement of the central bank’s autonomy by the government when the Finance Ministry reportedly decided to send a joint secretary to coordinate the RBI’s currency chest operations.
“There has been a report in sections of the press that some unions have alleged infringement of the autonomy of the Reserve Bank of India,” the Finance Ministry said in a statement on Saturday. “It is categorically stated that the Government fully respects the independence and autonomy of the Reserve Bank of India.”
“Consultations between the Government and the RBI are undertaken on various matters of public importance wherever such consultation is mandated by law or has evolved as a practice,” the statement added. “Consultations mandated by law or as evolved by practice should not be taken as infringement of autonomy of RBI.”
“If true, this (the sending of the joint secretary to the RBI) is most unfortunate and we take strong exception to this measure of the Government as impinging on RBI autonomy and its statutory as well as operational jurisdiction,” the union’s letter to Mr. Patel said.
“May we request you that as the Governor of RBI, its highest functionary and protector of its autonomy and prestige, you will please do the needful urgently to do away with this unwarranted interference from the Ministry of Finance, and assure the staff accordingly, as the staff feel humiliated,” the letter added.
