RBI Functions and Autonomy — Prelims Strategy

Prelims Strategy

Focus on factual accuracy regarding statutory provisions - memorize Section 7, 17, 18 of RBI Act and Section 35A of Banking Regulation Act. Create timeline of key events: RBI establishment (1935), nationalization (1949), MPC establishment (2016), Urjit Patel resignation (2018).

Practice elimination techniques by understanding common traps - confusing MPC voting rules, Governor removal procedures, and PCA framework details. Memorize MPC composition (3+3 structure), tenure details (4 years for external members), and decision-making process (majority voting with Governor's casting vote).

Stay updated on recent developments - CBDC pilot, regulatory actions against fintech companies, and policy coordination during crises. Use mnemonics for functions: FABRIC (Foreign exchange, Autonomy, Regulation, Banking, Issuance, Credit).

Focus on numerical facts - inflation target (4% ±2%), reserve requirements, and key dates. Practice questions on comparative aspects - RBI vs other central banks, pre and post-MPC scenarios.