Why can’t the Government/RBI appoint Deputy Governors in time?

It has become a habit of late to keep key positions at RBI empty despite knowing the positions are going to be vacant due to retirement/rotation.

As big decisions like demonetisation were implemented with three Deputy Governors  and most Board positions being empty. We learnt later that of the three Deputy Governors, just two were present in the meeting.

Now, it has been known that one of the Deputy Governors-S.S. Mundhra- is going to retire on 31 July 2017. RBI even released an advertisement for the position which is a good practice compared to previous appointments whose process was not really known.  The ad was released on 24 May 2017, so there was ample time as well. Though, the open ad created controversy as there were allegations that RBI intends to appoint a banker from the private sector.

We were also told about people in the fray but they were to be interviewed on 29 July which was really close to the date of retirement of Mr Mundhra.

As there was no decision by 31 July or it was delayed, RBI had to shift responsibilities between the 3 DGs.Mr Mundhra handled following tasks:

1. Co-ordination
2. Central Security Cell (CSC)
3. Consumer Education and Protection Department (CEPD)
4. Department of Banking Supervision (DBS)
5. Department of Co-operative Banking Supervision (DCBS)
6. Department of Non-Banking Supervision (DNBS)
7. Financial Inclusion and Development Department (FIDD)
8. Human Resource Management Department (HRMD) incl. HR Operations Unit (HR-OU)
9. Rajbhasha Department (RD)
10. Right to Information (RIA) Division

As the new DG comes in a few days, these tasks/responsibilities will have to be redesigned leading to unnecessary work.  We could do a lot better by making these appointments in time..

One Response to “Why can’t the Government/RBI appoint Deputy Governors in time?”

  1. Lessons from Mr Panagariya’s sudden exit: Need for clear appointment rules… - Daily Economic Buzz Says:

    […] it all so sudden. The Indian government has not been very active in these policy appointments as seen so often in case of RBI. May be Niti Aayog is not really a priority as we make it out to be. It already has twin powers […]

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