In Depth: Section 7 of RBI Act

The Central government is invoking a never-before-used power under the RBI Act... One that allows it to issue directions to the central bank governor on matters of public interest. Given that the RBI as the Central Bank is intended to be an autonomous institution ... this is an unusual departure from the norm The Government can issue directions to the RBI under Section 7 of the RBI Act...In recent weeks... The government is reported to have sent several letters to the RBI governor on several issues, ranging from liquidity for non-banking financial companies to capital requirements of weak banks and lending to micro, small and medium enterprises... Today in IN DEPTH, we talk in detail about Section 7 of the RBI Act... And also what led the government to invoke it for the first time. We will also talk about the role and functions of the Reserve Bank of India and other central banks worldwide.... Anchor: TEENA JHA