The government wants to restrict the tenure of non-official directors in the RBI?s central board to two successive terms of four years each. A provision to this effect has been introduced in the Banking Laws (Amendment) Bill.

Sources said that simultaneously the RBI Act, 1934, will also be amended.

According to Section 8 (1) of the RBI Act, 1934, the Centre has the powers to nominate such experts as non-official directors to the RBI central board.

The latest move is part of measures being taken to improve the governance and functioning of the RBI, they said. “Even the RBI governor and deputy governors normally get a maximum of two tenures only. So it won’t be proper to give indefinite tenures to non-official directors,” an official said.

The Banking Laws (Amendment) Bill was to be introduced in Parliament in the monsoon session, but is now expected to be done so in the winter session.

According to the RBI Act, the RBI central board ? whose function is the ?general superintendence and direction of the (central) Bank’s affairs” ?includes a governor and four deputy governors as full-time official directors.

In addition, the central board has non-official directors. These include ten people from various fields and two government officials, all nominated by the central government.

These non-official directors also include four persons ? one each from four local boards (that is, one each for the four regions of the country in New Delhi, Mumbai, Kolkata and Chennai).

YH Malegam, a renowned chartered accountant and the former president of the CA apex body ? the Institute of Chartered Accountants of India ? has been on the RBI Board since November 2000.

To his credit, his expertise has been used by the RBI to get valuable insights into several fields including microfinance, where a committee under his chairmanship submitted a report on its regulation.

In September last year, Malegam retired from the central board, only to be reappointed as a member in October 2011 for another four years.

Besides governor D Subbarao and deputy governors KC Chakrabarty, Subir Gokarn, Anand Sinha (RBI had recently sought an extension of his tenure) and HR Khan, the other members on the board include sociologist and JNU professor Dipankar Gupta, vice chancellor of Jamia Millia Islamia, Najeeb Jung, chairman of the GMR Group, G M Rao, founder and general secretary of Sewa (the NGO Self-Employed Women’s Association) Ela Bhatt, professor emeritus of the National Institute of Public Finance and Policy, Indira Rajaraman, former chairman of Atomic Energy Commission Anil Kakodkar, former chairman, Nasscom, Kiran Karnik, chairman, Aditya Birla Group of companies, K M Birla, IIM (Bangalore) professor Rajeev Gowda, Wipro chairman, Azim Premji, secretary, department of economic affairs, Arvind Mayaram and secretary (department of financial services) D K Mittal.