Legislating payments out of RBI’s excess capital could compromise its independence. Critically examine keeping in mind the recent committee established for examining issues of how much equity that RBI should hold. (200 W)

Source: https://www.civilsdaily.com/news/op-ed-snap-legislating-payments-out-of-rbis-excess-capital-could-compromise-its-independence/   Model Answer: RBI’s equity sharing works as a fuel cum cushion to its operations and supports against any financial downturn. In simple words, it is the capital set aside to meet the contingency requirement of RBI. The RBI’s current equity holding is around 27% of its total assets which puts an argument … Continue reading Legislating payments out of RBI’s excess capital could compromise its independence. Critically examine keeping in mind the recent committee established for examining issues of how much equity that RBI should hold. (200 W)