RBI board rejig cuts strength to 11; Somanath, Mahindra appointed
The Centre has changed the composition of the Reserve Bank of India’s board of directors, reducing its strength to 11 from 15 earlier.
The government has appointed former Indian Space Research Organisation (Isro) chair Somanath Sreedhara Panicker as a part-time, non-official director for four years from 20 August, the central bank said in a statement on Thursday.
In a separate statement, it said the Centre has reappointed Mahindra Group chair Anand Gopal Mahindra as a part-time, non-official director for another four years from 20 August.
The central board comprises the governor, four deputy governors, 10 directors from various fields, two government officials and four directors from four local boards. The function of the local boards is to advise the central board on local matters and to represent the territorial and economic interests of local cooperative and indigenous banks.
The external directors now include Revathy Iyer, Sachin Chaturvedi, Mahindra, Panicker, Anuradha Thakur, and Sanjay Lohiya. Before this, external members also included Satish Kashinath Marathe, Swaminathan Gurumurthy, Venu Srinivasan, Pankaj Ramanbhai Patel, Ravindra H. Dholakia, apart from the government officials.
Under the Reserve Bank of India (RBI) Act, directors nominated under a specific clause can hold office for four years and be eligible for reappointment. However, such a director cannot be appointed for more than two terms or for a maximum period of eight years, either continuously or intermittently.
The Tata twist
Interestingly, Srinivasan, the chairman emeritus of Sundaram Clayton Ltd and TVS Motor Co. Ltd, is also on the board of Tata Sons and backed its listing. In 2022, RBI released a list of upper-layer non-banks and said they had three years to get listed. Many from that list, such as Tata Capital and HDB Financial Services, were listed in time. Tata Sons remains the only company on that list to remain private.
Meanwhile, Shapoorji Pallonji Group, Tata Sons’ largest minority shareholder, is pushing for a listing of the firm in search of liquidity. The SP Group owns 18.38% in Tata Sons, nine Tata group firms own 12.86%, and seven individuals own the remaining 2.87%.
RBI recently retained Tata Sons Pvt. Ltd in the upper layer of non-banking financial companies (NBFCs-UL) for FY27, leaving the Tata group holding company subject to enhanced regulatory requirements while the central bank decides on the company’s application to surrender its core investment company (CIC) registration.
A media release by the RBI showed that Tata Sons continues to feature as a CIC. The statement clarified that the company’s inclusion is without prejudice to the outcome of its deregistration application, which remains under examination, as it had said in the last list in January 2025.
