The Election Commission on Tuesday
gave green signal to the Reserve Bank of India (RBI) for
"in-principle" grant of licences for setting up new banks.
Since the Model Code of Conduct
(MCC) came into operation on March 5, after the announcement of the general
election schedule, the RBI had written to the Commission on March 12 seeking
clarity on the issue of grant of new bank licenses.
"The Commission is of the view
that the Reserve Bank of India (RBI) may take necessary action (for grant of
in-principle approval for banking licences) as deemed appropriate," the EC
Principal Secretary K. Ajaya Kumar wrote to RBI Governor Raghuram Rajan.
The RBI had earlier planned to issue
new bank licenses in March after a gap of ten years. The RBI had received 27
applications initially. Later, Tata Sons and Value Industries withdrew, leaving
25 contenders in the race.
Earlier in the day, Dr. Rajan while
unveiling bi-monthly monetary policy in Mumbai had said that once the central
bank gets the Elections Commission's approval it would expedite the process and
grant licences.
"Once they (EC) say there is no
issue there, they (RBI) would be in a position to announce the bank licences
very quickly after taking it to the committee of the central board," Dr.
Rajan had said.
Source : http://www.thehindu.com/
