RBI Takes Small Step Towards Transparency With Release Of Board Minutes

The Reserve Bank of India, often criticised for being opaque as an institution, has decided to take a step towards transparency by releasing the minutes of its central board meetings.

The move is in line with attempts to enhance transparency around its function, the RBI said in a press release on Monday, although it retained the right to restrict information exempted from the purview of the Right To Information Act.

“As a measure of further enhancing public awareness about the functioning of the RBI, it has been decided to place the minutes of the meetings of the central board on the RBI’s website in terms of provisions of Section 4 of the RTI Act, after appropriately severing information that is permitted to be severed as per the act,” the central bank said.

The minutes, however, will continue to come with considerable delay. They will be placed on the RBI’s website within two weeks of the minutes being confirmed, according to the press release. The confirmation of the minutes of one board meet usually takes place at the subsequent board meet.

The debate over the release of central board meeting minutes has stretched over years. While the minutes have been often accessed via the RTI Act, the central bank has refrained from making the release of these minutes a regular feature. The decision to begin releasing these minutes comes at a time the central board is playing a larger role in decision-making at the RBI. Crucial issues, including the amount of reserves to be held on the central bank’s balance sheet, have, in recent months, being debated within the central board.

To be sure, the central bank may choose to redact some of these discussions under provisions of the RTI Act, which allow information to be withheld on grounds that it may hurt interests of the economy.

Oct. 11 Board Meet

The first set of board minutes released by the RBI are those from the Oct. 11 meet. The central bank chose to disclose an agenda of 17 items but redacted one item.

The disclosure on each of the items listed, however, was minimal.

For example, the minutes showed that the board discussed the liquidity situation and the flow of credit to the economy. There was no detail included on the nature of the discussion.

While discussing macroeconomic conditions, the minutes showed, that “a director” was of the view that concerted efforts on part of the government and regulators is required to improve the situation.

Further, the PMC Bank issue was discussed at the board of meeting. “It was informed that the RBI has taken/initiated several measures to strengthen supervision and regulation of these entities,” the minutes said.

Reports on the workings of the Board of Financial Supervision, Deposit Insurance and Credit Guarantee Corporation and Financial Markets Division were taken on board, according to the minutes. Again, no further details were included in the minutes.