There are few institutions in India with a history of 90 years that are still thriving. The Reserve Bank of India (RBI) is one such institution, celebrating its 90th anniversary on April 1, 2024. Prime Minister Narendra Modi will attend the event at Mumbai’s National Centre for the Performing Arts.
Established on April 1, 1934, the RBI’s origins trace back to the Royal Commission on Indian Currency and Finance in 1925. Sir Osborne Smith served as the first Governor when operations began on April 1, 1935. The RBI has had twenty-six Governors, with Shaktikanta Das currently in office since October 2021.
Over the years, the RBI’s responsibilities have expanded to include monetary management, financial system regulation, foreign exchange management, currency issuance, and payment system supervision. The RBI has achieved significant milestones as an independent institution.
The RBI’s balance sheet stands at Rs 63 lakh crore as of March 31, 2023, exceeding the government’s annual budget. The RBI’s robust balance sheet allowed it to provide liquidity support post-COVID-19. India’s foreign exchange reserves of USD $642 billion rank fourth globally, supporting rupee stability.
The RBI’s role in inflation management has evolved with a flexible inflation targeting framework since 2016. The RBI also regulates the financial sector, implementing initiatives to reduce non-performing assets and serving as a lender of last resort during crises.
In promoting digital payments, the RBI has played a vital role, with UPI handling 12 billion transactions per month. UPI is poised to surpass global payment networks like Visa and Mastercard in the coming years.
