Reserve Bank of India 5.48

"As Reserve Bank commences operations today I take [the] opportunity to…express my confidence that this great undertaking will contribute largely to the economic well being of India and…its people." excerpt from telegram sent by the Viceroy to Osborne Smith, first governor of the Reserve Bank, 1935

-----------------------------------PREAMBLE----------------------------------

“to regulate the issue of Bank notes and the keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage”

The objectives outlined in the Preamble hold good even after 75 years. As evident from the multifaceted functions that the Reserve Bank performs today, its role and priorities have, in the span of 75 years, changed in tandem with changing national priorities and global developments. Essentially, the Reserve Bank has demonstrated dynamism and flexibility to meet the requirements of an evolving economy.

-------------------Origins of the Reserve Bank of India--------------------

1926: The Royal Commission on Indian Currency and Finance recommended creation of a central bank for India.
1927: A bill to give effect to the above recommendation was introduced in the Legislative Assembly, but was later withdrawn due to lack of agreement among various sections of people.
1933: The White Paper on Indian Constitutional Reforms recommended the creation of a Reserve Bank. A fresh bill was introduced in the Legislative Assembly.
1934: The Bill was passed and received the Governor General’s assent
1935: The Reserve Bank commenced operations as India’s central bank on April 1 as a private shareholders’ bank with a paid up capital of rupees five crore (rupees fifty million).
1942: The Reserve Bank ceased to be the currency issuing authority of Burma now Myanmar).
1947: The Reserve Bank stopped acting as banker to the Government of Burma.
1948: The Reserve Bank stopped rendering central banking services to Pakistan.
1949: The Government of India nationalised the Reserve Bank under the Reserve Bank (Transfer of Public Ownership) Act, 1948.