Topic: . Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
4) The nature of geo-politics and the rapid advances in digitisation require the Reserve Bank of India (RBI) to urgently rethink its extant supervisory policies. Examine. (250 words)
Why this question:
The question is in the context of urgent reforms required in the Reserve Bank of India (RBI), the need for the Bank regulations to adapt to the new reality of rapid advances in digitisation, as financial systems are the core to an economy’s smooth functioning.
Key demand of the question:
The answer should discuss in detail what are the issues RBI is currently facing, how changing geopolitics affect the functioning of financial systems and thus the need of RBI to change its existing supervisory functions and policies.
Examine – When asked to ‘Examine’, we have to look into the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications.
Structure of the answer
Briefly bring out the role of Reserve Bank of India and its significance in managing the economy of the country.
Discussion of the answer should cover:
- Effect of geopolitics, international economic stability on Indian economy vis a vis role of RBI to manage the effect.
- Effect of rapid digitization across the world and preparedness of RBI to manage the transformation or the great leap going forward.
- What changes are required to be brought in ? what are the issues and concerns facing RBI.
- Way forward.
Conclude with what needs to be done, what path should Reserve bank of India take to empower the Indian economy in pace with the rapid digitization.