Finance ministry prefers amendment to RBI Act for appointing a COO

The finance ministry will firm up its view on Reserve Bank of India governor Raghuram Rajan’s move to appoint a chief operating officer (COO) only after the latter initiates a formal proposal seeking an amendment to the RBI Act toward this end. The finance ministry is not in favour of any ad hoc arrangement for a lateral hire, which essentially means that the COO appointment cannot be made in a hurry as changing the RBI Act could take a while. “An amendment to the Act can’t be done just like that. It will be a political decision and require wider stakeholder consultation,” said a ministry official, who added that the internal disquiet over the issue would also have to be taken into account. Some RBI employees have written to board members opposing lateral hiring at the central bank. The finance ministry feels there is no point appointing a COO if the person doesn’t have the rank of deputy governor (DG) and is unable to attend board meetings.


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