Recently Bimal Jalan committee was in news consider the following statements in this context 1 The m...........

Economic Affairs Money Supply and Monetary Policy

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Recently, Bimal Jalan committee was in news, consider the following statements in this context-

1. The main objective of the committee is to set framework in which RBI’ surplus can be shared with the government.

2. At present, RBI Act does not aurthorise sharing of RBI’s profit with Central Government.

Which of the above statements is/are correct?

Choose the correct answer using the codes below-

1 only

2 only

Both 1 and 2

Neither 1 nor 2

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Explanation:

The Committee was set up in December 2018 following discussions between the finance ministry and the RBI about the manner in which the central banks’ surplus can be shared with the government.

According to Section 47 of the RBI Act, profits of the RBI are to be transferred to the government, after making various contingency provisions, public policy mandate of the RBI, including financial stability considerations.

The committee was set up to “review status, need and justification of various provisions, reserves and buffers presently provided for by the RBI; and (to) review global best practices followed by the central banks in making assessment and provisions for risks which central bank balance sheets are subject to.