RBI was created to be independent from the Centre: Kapil Sibal

Supporting the letter written by the Reserve Bank of India (RBI) employees to Governor Urjit Patel protesting against operational "mismanagement" post demonetisation, Congress leader Kapil Sibal on Saturday said that the RBI was created to be independent of the government which has now been interfered during the drive.

"RBI is created to be entirely independent of the government and this tradition is sought to be interfered with and I think that the feeling of the establishments are justified," Sibal told ANI.

Further commenting on the silence maintained by RBI governor over the same, Sibal said that the former may have done some things which require being silent.

In a letter, the employees said that the autonomy and image of RBI has been "dented beyond repair" due to mismanagement and termed the appointment of a senior Finance Ministry official for currency coordination as a "blatant encroachment" of the RBI's exclusive turf.

In a strongly worded letter addressed to Reserve Bank of India (RBI) Governor Urjit Patel, the United Forum of Reserve Bank Officers and employees have alleged that post the government's demonetisation move, the image of the Central bank has been dented beyond repair.

"We request the Governor of the RBI, its highest functionary and protector of its autonomy and prestige, to do the needful urgently to do away with this unwarranted interference from the Finance Ministry and assure the staff accordingly as the staff feels humiliated," the letter added.

Various employee unions of the central bank have objected to the government "impinging on RBI autonomy" and have written to Patel to take action against the "unwarranted interference".

In a letter, they said the autonomy and image of the RBI has been "dented beyond repair" due to mismanagement and termed the appointment of a senior Finance Ministry official as a "blatant encroachment" of its exclusive turf of currency management.

Meanwhile, the Finance Ministry has clarified its stand stating that the Government fully respects the independence and autonomy of the Central Bank.

In a statement, the Ministry said that consultations between the Centre and the RBI are undertaken on various matters of public importance, wherever such consultation is mandated by law or has evolved as a practice.

"Consultations mandated by law or as evolved by practice should not be taken as infringement of autonomy of RBI," the statement added.