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News: The Centre has announced the appointment of Revenue Secretary Sanjay Malhotra as the 26th Governor of the Reserve Bank of India.
About RBI Governor Appointment
- The RBI governor is appointed under the RBI Act of 1934, which stipulates that the chief is appointed by the central government.
- Process:
- The Financial Sector Regulatory Appointment Search Committee, consisting Cabinet Secretary, current RBI Governor, Financial Services Secretary and two independent members, prepares a list of people eligible to hold the post.
- The shortlisted candidates are interviewed, and the list is forwarded to the Cabinet Committee on Appointments, chaired by the Prime Minister, for final approval.
- Tenure:
- The governor serves a term of up to five years, with the duration determined by the government at the time of appointment.
- The central bank chief is also eligible for reappointment or an extension.
- Qualifications– The RBI Act, 1934 does not mention any specific qualification for the governor. People with different educational backgrounds were selected to head the institution.
