RBI board meeting of 14 December stands as of now, says Economic Affairs Secretary Subhash Chandra Garg

New Delhi: Economic Affairs Secretary Subhash Chandra Garg on Tuesday said the 14 December RBI board meeting stands and there has been no change in the schedule so far.

There was confusion over the fate of 14 December central board meeting of the RBI following the abrupt resignation of Urjit Patel as Governor of the central bank on Monday.

Representational image. Reuters

Representational image. Reuters

Acting swiftly, the government on Tuesday appointed former Economic Affairs Secretary Shaktikanta Das as the 25th Governor of the Reserve Bank of India (RBI).

The crucial board meeting is expected to see discussion on various issues including governance reforms at the RBI.

"The 14 December meeting stands as of now. If RBI decides otherwise, we will get to know," Garg told reporters here.

For the last few weeks, the RBI has been at loggerheads with the finance ministry on matters ranging from the appropriate size of the reserves the central bank must hold to the easing of lending norms for sectors such as small and medium enterprises.

The friction between the RBI and the finance ministry was attributed to the recalcitrance of Patel, who appeared keen to be seen as a defiant, independent-minded governor of high credibility by resisting the government's call for increased transparency on the central bank's reserves (just how much is necessary for stability operations) and for enhanced liquidity so that credit can be eased to money-strapped sectors especially MSMEs.

The government cited Section 7 of the RBI Act - a never-used-provision - to ask the governor to discuss the contentious issues. The government wanted greater oversight on RBI's functioning and a review of its economic capital framework.

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Updated Date: Dec 12, 2018 12:00:18 IST

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