Question

Which of the following statements are true with respect to Reserve Bank of India ?

1. The Reserve Bank of India was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934.
2. The Central Office of the Reserve Bank was shifted from Kolkata to Mumbai in 1937.
3. The Reserve Bank of India was nationalised in 1949.
4. The Reserve Bank of India serves as the custodian of India's foreign exchange reserves.

• A. iii, iv
• B. iv only
• C. ii, iv
• D. All of these

Answer 1

Answer:

D. All of these

• The RBI was indeed established on April 1, 1935. It was set up based on the recommendations of the Hilton Young Commission and is governed by the RBI Act of 1934.

• While originally established in Kolkata (then Calcutta), the Central Office—where the Governor sits and policies are made—was permanently moved to Mumbai in 1937.

• After India gained independence, the RBI was nationalised on January 1, 1949. Before this, it was actually a shareholders' bank (privately owned).

• One of the RBI's core functions is to act as the custodian of foreign exchange reserves. It manages the volatility of the Rupee and ensures India has enough foreign currency (like USD, Euro, Gold) to handle international trade and debt.