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Government appoints S Gurumurthy, Satish Marathe as part-time Directors on RBI Board

Aug 8, 2018 12:49 IST
Government appoints S Gurumurthy, Satish Marathe as part-time Directors on RBI Board

The Central Government on August 7, 2018 appointed journalist Swaminathan Gurumurthy and Sahakar Bharathi patron Satish Kashinath Marathe as part-time non-official Directors on the Central Board of Reserve Bank of India (RBI) following the approval from the Appointments Committee of the Cabinet.

Both Gurumurthy and Marathe have been appointed for a four year term. Their names were proposed by the Department of Financial Services of the Union Ministry of Finance.

The appointments were made under Section 8(1)(c) of the RBI Act, 1934.

Note

With these latest appointments, the total number of government appointed directors on the RBI board comes to 10, the maximum permitted. Besides, the government also has two government officials on the board.

These are Nachiket Mor, Subhash Chandra Garg, Prasanna Kumar Mohanty, Rajiv Kumar, Dilip S. Shanghvi, Natarajan Chandrasekaran, Bharat Narotam Doshi, Sudhir Mankad, Ashok Gulati, and Manish Sabharwal

Swaminathan Gurumurthy: Convener of the RSS affiliate Swadeshi Jagaran Manch

• Gurumuthy is a chartered accountant, an economist and a writer on political and economic affairs. He is currently the Editor of Tamil political weekly ‘Thuglaq’.

• He shares strong association with the right-wing Rashtriya Swayamsevak Sangh (RSS) and is the convener of the RSS affiliate Swadeshi Jagaran Manch.

• Gurumurthy is also the strong supporter of the NDA Government’s demonetisation stand. In his article in the Hindu newspaper in November 2017, Gurumurthy termed the demonetisation as “a fundamental corrective to the economy much like liberalisation of the 1990s.”

Comment

The appointment of Gurumurthy on the RBI board has led to few apprehensions due to his visibly seen political inclinations towards the current NDA government.

Though, he has adequate qualifications as an economist and CA, his open political leanings pose a matter of concern.

Satish Kashinath Marathe: Patron of Sahakar Bharati

• Satish Kashinath Marathe is the patron of Sahakar Bharati, an NGO that is working to further the co-operative moment in India.

• At a very young age, Marathe was associated with the Akhil Bharatiya Vidyarthi Parishad (ABVP), which is affiliated to the Rashtriya Swayamsevak Sangh (RSS).

• He currently serves on the boards of Thane Bharat Sahakari Bank Ltd and Rajkot Nagarik Sahkari Bank Ltd.

• He had enjoyed a long working career in the banking sector beginning with the Bank of India.

• He had worked with various banks including The United Western Bank Ltd and Janakalyan Sahakari Bank Ltd.

• He also worked as Honorary Secretary of Indian Banks’ Association and Vice President of Private Sector Bank’s Association.

The Central Board of Directors of RBI

  • The RBI's affairs are governed by a Central Board of Directors. The board is appointed by the Central Government in keeping with the RBI Act, 1934.
  • The Central Board of the RBI is split into Official and Non-official Directors.
  • The Official Directors are full-time directors. These are Governor and 4 Deputy Governors.
  • The Non-Official Directors include 10 Directors from various fields and two government Official –nominated by Central Government; and 4 Directors - one each from four local boards of Mumbai, Calcutta, Chennai and New Delhi.
  • The RBI Central Board is not a typical decision making body. It is more like a forum for discussions.
  • The decisions taken by Central Government such as the demonetisation decision or change in the RBI’s dividend policy go through the RBI central board.
  • The decision regarding the change in Interest Rates is outside the purview of the board.
 

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