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Saturday, January 14, 2017

Government impinging on RBI autonomy: Unions

 | Jan 14, 2017,

MUMBAI: Various employee unions of the central bank have objected to the government "impinging on RBI autonomy" and have written to governor Urjit Patel to take action against the "unwarranted interference".

In a letter to the governor, the United Forum of Reserve Bank Officers and Employees said that they have read reports of a joint secretary from the finance ministry being sent to the RBI headquarters to coordinate currency operations.

"If true, this is most unfortunate and we take strong exception to this measure of the government as impinging on the RBI autonomy and its statutory as well as operational jurisdiction," the letter said "Apart from showing RBI operations and its gigantic performance in poor light, the government now blatantly encroaches on its jurisdiction, which we cannot accept. We want to state that the RBI is fully capable to coordinate the central bank's currency chest operations," the letter said.

The letter sought to draw attention to the RBI Act 1934, which stipulates that the central bank was constituted lo "regulate the issue of notes and keeping of reserves with a view to secure monetary stability in India" and generally to operate the currency and credit system of the country.

The employees said from 1935, the RBI has developed, perfected and expanded the currency management system in the country. The RBI has set up more than 4,000 currency chests and coin vaults. 

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