Mumbai: The Reserve Bank of India (RBI) Monday ended its nine-hour long Marathon meeting with some major decisions on cash flow in the open market and Micro Small and Medium Enterprises (MSMEs). The meeting had the central bank agreeing to increase the liquidity in the open market, an issue which had triggered a dispute between Urjit Patel-led RBI and the Narendra Modi government. The central bank would now inject Rs 8,000 crore into the market by purchasing government securities on November 22, 2018. Also Read - What is RBI's 3-Month Moratorium? Will EMI be Deducted From Your Account? Here Are Your Answers

“Based on an assessment of prevailing liquidity conditions and also of the durable liquidity needs going forward, the Reserve Bank has decided to conduct purchase of government securities under Open Market Operations for an aggregate amount of Rs 80 billion on November 22, 2018 through multi-security auction using the multiple price method,” the RBI said in a statement on Monday. Also Read - How RBI Set up War Room in Just One Day Amid Coronavirus Outbreak

The Central Board of the RBI also advised that the RBI should consider a scheme for the restructuring of stressed MSMEs. “The Board also advised that the RBI should consider a scheme for the restructuring of stressed standard assets of MSME borrowers with aggregate credit facilities of up to Rs 250 million (Rs 25 crore), subject to such conditions as are necessary for ensuring financial stability,” the statement added. Also Read - New Rules For Debit And Credit Cards Kick in From Monday

The RBI board on Monday decided to form an expert committee to examine the economic capital framework of the central bank, which will decide the number of reserves it can maintain, handing over the balance to the government. “The Board decided to constitute an expert committee to examine the ECF, the membership and terms of reference of which will be jointly determined by the Government of India and the RBI,” it said.

Discussions in the meeting may also have focussed on the massive Rs 9.69 lakh crore reserves of the RBI, with Gurumurthy and the finance ministry wanting it to be lowered in line with global practices. Most of the RBI’s 10 independent directors, including Tata Sons Chairman N Chandrasekaran, attended the meeting that had drawn intense media and market attention.

In the run-up to the board meeting, former Finance Minister P Chidambaram said Patel should step down if the board were to issue any direction to it on the parting of capital reserves or relaxation of norms. The RBI’s central board currently has 18 members, though the provision is that it can go up to 21.

With agency inputs