Question

Consider the following pairs of committees and their mandate, which were in the news recently :

Committee	Mandate
A. U.K. Sinha	(I) Transfer of Surplus reserves from SEBI to the Government
B. Nandan Nilekani	(II) Deepening digital payments
C. Bimal Jalan	(III) Economic capital framework

Which of the above are correctly matched? Choose the correct answer from the options given below :

1. A and B only
2. B and C only
3. A and C only
4. A, B and C

Answer 1

Correct Answer - Option 2 : B and C only

The correct answer is B and C only.

• U.K. Sinha Committee on MSME: Hence, Pair 1 is incorrectly matched.
  • Reserve Bank of India (RBI) formed a committee headed by former SEBI Chairman U.K. Sinha to study the problems faced by MSMEs.  
  • Form a ₹5,000 crore stressed asset fund for MSMEs which will assist units in a cluster becoming sick due to changes in external factors such as plastic ban, which had resulted in a large number of such entities becoming non-performing.
  • RBI should increase the limit for non-collateralized loans to ₹20 lakh.
  • It also suggested revision in the loan limit sanctioned under MUDRA by the Finance Ministry to ₹20 lakh from ₹10 lakh.
  • Banks that wish to specialize in MSME lending, their sub-targets for farm loans under the priority sector lender could be waived off, and instead can be given a target for loans to the SME sector. The targets could be 50% of the net bank credit for universal banks and 80% for small finance banks.
  • To provide loan portability seamlessly to MSMEs, RBI should come out with measures on the portability of MSME loans with a lock-in period of one year.
  • On August 14, 2019, a committee headed by former RBI governor Bimal Jalan recommended transferring a sum of ~1,76,051 crore to the government, comprising ~1,23,414 crore of surplus for the year 2018-19 and ~52,637 crores of excess provisions identified as per the revised Economic Capital Framework (ECF).
• Nandan Nilekani Committee on Deepening digital payments: Hence, Pair 2 is correctly matched.
  • To encourage digital payments, the Nandan Nilekani committee has suggested a host of measures, including elimination of charges, round-the-clock RTGS and NEFT facility, and duty-free import of point-of-sales machines.
• Bimal Jalan Committee on Economic capital framework: Hence, Pair 3 is correctly matched.
  • Reserve Bank of India (RBI) accepted the Bimal Jalan panel recommendations, set up to review the Reserve Bank of India’s (RBI’s) economic capital framework.
  • Following these recommendations, RBI decided to transfer Rs 1.76 lakh crore in dividend and surplus reserves to the government.
  • The objective of the economic capital framework is to build harmony between the central bank’s need for autonomy and the Government's objectives of the development.
  • The Bimal Jalan-led panel recommended holistic risk capital frameworks to assess the adequacy of RBI reserves.