RBI-Reserve Bank of India - Function and Role .

-

What is RBI ?

Reserve Bank of India (RBI) is India’s central bank. It controls the monetary policy concerning the national currency, the Indian rupee. The basic functions of the RBI are the issuance of currency, to sustain monetary stability in India, to operate the currency, and maintain the country’s credit system.  

Functions of Reserve Bank of India

Reserve Bank of India works as:

Monetary Authority

  • Implementation of monetary policies.
  • Monitoring the monetary policies
  • Ensuring price stability in the country considering the economic growth of the country

Also, read about the Monetary Policy Committee (MPC) and know more about this six-member committee.

Regulator and Administrator of the Financial System

  • The RBI determines the comprehensive parameters of banking operations.
  • These methods are responsible for the functioning of the country’s banking and financial system. Methods such as:
    • License issuing
    • Liquidity of assets
    • Bank mergers
    • Branch expansion, etc.

Managing Foreign Exchange

  • RBI manages the FOREX Reserves of India.
  • It is responsible for maintaining the value of the Rupee outside the country. 
  • It aids foreign trade payment. 
  IMPORTANCE OF RBI 

RBI’s Developmental role

  • Promotional functions that support national objectives are organized by RBI that encourage rural and agricultural economic development.
  • The RBI will regularly issue directives to the commercial banks to lend loans to small-scale industrial units. 

Comments

Post a Comment

Popular posts from this blog

Agro-Based Industries: Meaning, Constraints and Suggestions

-
Image
  Meaning of Agro-Based Industries: Agro-based industries need a special mention since their importance in the Indian context gets further enhanced because of the following factors: (a) Agro-based industries are comparatively easy to establish and provide income in the rural areas with less investment. (b) These industries facilitate effective and efficient utilisation of agricultural raw materials. (c) Agro-based industries transmit an industrial – culture in rural areas thus bringing about modernisation and innovation in agriculture itself. (d) Some of the agro-based industries like processed food and food preparations have tremendous export potential. (e) Agro-based industries can be set up on co-operative basis ensuring participation of the people in the development process. In view of the above, and further in view of the fact that the agriculture is mixed in what has been called a ‘green reaction’ (characterised by mediocre growth, the stagnation of yields and persistent instabil
Read more

new industrial policy - meaning , objectives , significance and challenges .

-
Image
  New industrial policy Meaning – govt. action to influence the ownership & structure of the industry and its performance. It includes procedures, principles, policies, rules and regulations, in­centives and punishments, the tariff policy, the labour policy, government’s attitude towards foreign capital, etc. Objectives §   to maintain a sustained growth in productivity; §   to enhance gainful employment; §   to achieve optimal utilisation of human resources; §   to attain international competitiveness; and §   to transform India into a major partner and player in the global arena.   Timeline of industrial policy reform   Industrial Policy Resolution, 1948 It declared the Indian economy as Mixed Economy Strategic Industries (Public Sector):  It included three industries in which Central Government had monopoly. These included Arms and ammunition, Atomic energy and Rail transport. Basic/Key Industries (Public-cum-Private Sector
Read more

What are the important causes for the beginning of the Renaissance in Europe?

-
  The Renaissance was rendered possible by a combination of number of factors which were as follows: 1.   Decline of Feudalism. In the first place the decline of feudalism, which was the basis of life during the medieval period, greatly contributed to the rise of Renaissance. The feudalism which began to decline by the close of the thirteenth century in France and Italy virtually disappeared from Western European countries by the 1500 A.D The one major factor which played a dominant role in the decline of feudalism was the rise of the middle class comprising of traders and businessmen. These middle classes provided the kings necessary money for the maintenance of armies and thereby enabled them to reduce their dependence on the feudal lords. Further, due to development of trade and commerce during this period, there was great increase in prices which greatly benefited the craftsmen, merchants and cultivators. As the feudal lords could not in­crease their rents they were forced to borro
Read more