Sanjay Malhotra will be the new RBI Governor

Why in the news?

• The government has appointed Revenue Secretary Sanjay Malhotra as the new Governor of the Reserve Bank of India (RBI).
• He will be the 26th Governor of RBI and will replace the current Governor Shaktikanta Das.
  • Shaktikanta Das was appointed Governor on 12 December 2018.
  • His tenure was later extended for 3 years.
  • His tenure is ending on 10 December 2024.
• Malhotra will take over as Governor from 11 December.

About Sanjay Malhotra:

• He is a 1990 batch Indian Administrative Service (IAS) officer of Rajasthan cadre.
• He has an Engineering degree in Computer Science from Indian Institute of Technology (IIT) Kanpur and a Master's degree in Public Policy from Princeton University, USA.
• He has worked in various sectors including Power, Finance and Taxation, Information Technology and Mines.
• He has more than 33 years of experience.
• Before serving as Secretary (Revenue) in the Ministry of Finance, he held the post of Secretary in the Department of Financial Services under the Ministry of Finance, Government of India.
• He has expertise in finance and taxation at both state and central government levels.

RBI Governor Appointment Process:

• They are appointed under the RBI Act, 1934.
• The central government appoints the governor.
• For this, the Financial Sector Regulatory Appointment Search Committee prepares a list of eligible candidates.
  • This committee consists of the Cabinet Secretary, the current RBI Governor, the Financial Services Secretary and two independent members.
• After this, the selected candidates are interviewed.
• Their names are sent to the Appointment Committee of the Cabinet. 
  • This committee works under the chairmanship of the Prime Minister.
  • This committee selects the governor by confirming the appointment.

Reserve Bank of India (RBI):

• It is the central bank of India, established on 1 April 1935.
• Its main objectives:
  • To control the monetary policy of the country
  • To control inflation
  • To maintain financial stability
• Its main functions:
  • Monitoring Indian banks
  • Managing the Indian currency (rupee)
  • Determination of interest rates for banks
  • This affects economic growth and inflation
  • Managing foreign exchange reserves
  • Managing government bonds
  • Stability of the overall financial system of the country
  • Stability in the banking system; etc