Here is Question No. 51 a part of our series on UPSC Prelims 2021.
Q51. Consider the following statements:
- The Governor of the Reserve Bank of India (RBI) is appointed by the Central Government.
- Certain provisions in the Constitution of India give the Central Government the right to issue directions to the RBI in the public interest.
- The Governor of the RBI draws his power from the RBI Act.
Which of the above statements is correct?
a) 1 and 2 only
b) 2 and 3 only
c) 1 and 3 only
d) 1, 2 and 3
Answer: (c)
- Statement 1 is correct: RBI Governor and Deputy Governors are appointed by the Central Government. Section 8(1)(a) of the Reserve Bank of India Act, 1934, provides that there shall be one Governor and not more than four Deputy Governors to be appointed by the Central government on the central board of RBI.
- Statement 2 is incorrect: RBI Act, 1934- The Central Government may from time to time give such directions to the Bank as it may, after consultation with the Governor of the Bank, consider necessary in the public interest. The Constitution of India does not provide any provision for the central government’s right to issue directions to the RBI in Public interest.
- Statement 3 is correct: According to the RBI Act, the Governor shall have powers of general superintendence and direction of the affairs and the business of the RBI. He/she may exercise all powers and do all acts and things which may be exercised or done by the RBI.
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