Official UPSC Format

With reference to different Committees in India, consider the following details :
Sl. No.CommitteeObjectiveOrganization under which it was formed
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1.R.N. Malhotra CommitteeComprehensive reforms of Insurance sector in IndiaInsurance Regulatory and Development Authority of India
2.L.C. Gupta CommitteePreparing a roadmap for the introduction of derivatives trading in IndiaSecurities and Exchange Board of India
3.Urjit R. Patel CommitteePreparing a roadmap for reforming bank lending to the Housing sectorReserve Bank of India
4.Y.H. Malegam CommitteePreparing a roadmap for reforms in Microfinance sector in IndiaReserve Bank of India

In which of the above rows are all the details correctly matched ?

⚡ Quick Recall Snippet

Several pivotal committees have shaped India's financial sector. SEBI formed the L.C. Gupta Committee to introduce derivatives trading. The RBI formed the Malegam Committee for microfinance reforms and the Urjit Patel Committee for the Monetary Policy Framework. The Malhotra Committee on insurance was formed by the Government of India.

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Detailed Solution & Authority Citations

Correct Answer is Option D
Let's review the historical mandates of these financial committees:
  • Row 1 is Incorrect: The R.N. Malhotra Committee (1993) did indeed design comprehensive insurance reforms. However, it was constituted directly by the Government of India. The IRDAI was established in 1999 as a result of this committee, making it chronologically impossible for IRDAI to have formed it.

  • Row 2 is Correct: The L.C. Gupta Committee was appointed by SEBI in 1996. It successfully developed the regulatory roadmap that allowed for the introduction of financial derivatives trading in Indian markets.

  • Row 3 is Incorrect: The Urjit R. Patel Committee (2013), formed by the RBI, is one of the most famous modern committees. However, its mandate had absolutely nothing to do with housing loans. Its objective was to revise the Monetary Policy Framework, famously leading to the adoption of the inflation-targeting framework and the MPC.

  • Row 4 is Correct: In the wake of the Andhra Pradesh microfinance crisis, the RBI constituted the Y.H. Malegam Committee (2010) to study and recommend strict regulatory guardrails for the NBFC-MFI (Microfinance) sector.
    • Conclusion: Only rows 2 and 4 are completely accurate.

    🚨 The Examiner's Trap

    The examiner uses chronological paradoxes (Row 1) and outright mandate swapping (Row 3 - assigning housing to Urjit Patel instead of his famous inflation targeting mandate) to punish candidates who only half-remember names.

    Active Recall Flashcard

    Tap to Flip

    What was the primary objective of the Urjit R. Patel Committee constituted by the RBI in 2013?

    To revise and strengthen the Monetary Policy Framework (introducing flexible inflation targeting and the MPC).

    Concept Flow Mapping

    L.C. Gupta Committee
    Introduced
    Derivatives Trading
    Urjit Patel Committee
    Reformed
    Monetary Policy Framework
    Y.H. Malegam Committee
    Regulated
    Microfinance Sector

    Logic Quest

    "Why couldn't the IRDAI have formed the Malhotra Committee?"

    Not analyzing core concepts like Institutional Financial Reforms through the lens of Previous Year Questions is a serious miss-out. This PYQ engine is specifically designed to help you decode the examiner's mindset and master highly probable Economy questions for your upcoming Prelims.