The Reserve Bank of India staff on mass casual leave today

Mumbai: RBI employees will go on a day’s mass casual leave on Thursday to protest the government’s move to relieve the central bank of a few of its vital operations “in the name of the draft financial code and legislative reforms”.

Unless the RBI announces contingency measures, the strike is expected to affect payment and settlements at banks and in markets, but is unlikely to have much impact on the final shape of reforms to the central bank.

The “one-day mass causal leave” is likely to cripple settlement activities at the banks.

The protest, the first at the Central bank in six years, has been called by the United Forum of Reserve Bank Officers and Employees, which is the umbrella organisation of four recognised unions of officers and workmen at the Central bank. Rajan had agreed with the government to form a monetary policy committee that will have members nominated by the government to decide on policy rather than the current set-up where the RBI has the absolute power.

Samir Ghosh, general secretary of the All India Reserve Bank Employees’ Association said that repeated attempts of the RBI staff to convince the government for pension revision has been in vain.

At a time when the geopolitical factors are keeping market players on their toes because of volatility in crude oil prices and the dollar-rupee rates, payments-related issues at home are adding to their worries, dealers said.

The draft Indian Finance Code (IFC) has proposed re-aligning of the powers of the RBI vis-a-vis the finance ministry through the composition and functioning of the monetary policy committee that would be responsible for setting rates.

The unions are opposing the government move to take away the public debt management activities from the Central bank and curtail its powers on the monetary policy. This fund settlement takes place through the RBI and is primarily meant for large value transactions.