Narsimham Committee
The Narsimham Committee is a committee formed to recommend financial reforms in India. It was constituted in 1991 under the chairmanship of M. Narasimham, former Governor of the Reserve Bank of India (RBI). The committee submitted two reports, popularly known as Narsimham I and Narsimham II, in 1991 and 1998 respectively.

Recommendation to Merge Regional Rural Banks (RRBs)
One of the recommendations made by the Narsimham Committee was the merger of Regional Rural Banks (RRBs) with their sponsor banks. RRBs were established in India in 1975 with the objective of providing banking services to the rural population and promoting rural development. However, over time, RRBs faced various challenges such as weak financial health, governance issues, and lack of autonomy.

The Narsimham Committee observed that the performance of RRBs was not up to the mark and they were facing difficulties in meeting their objectives. The committee recommended that RRBs should be merged with their respective sponsor banks to address these challenges and improve their functioning.

Advantages of the Merger
The merger of RRBs with their sponsor banks was expected to bring several advantages:

1. Improved Financial Health: The merger would strengthen the financial position of RRBs by leveraging the resources and expertise of the sponsor banks.

2. Governance and Management: The merger would bring professional management practices to RRBs, enabling them to operate more efficiently and effectively.

3. Technology and Infrastructure: RRBs would have access to the advanced technology and infrastructure of their sponsor banks, enabling them to offer better services to their customers.

4. Synergy and Scale: The merger would lead to synergy between RRBs and sponsor banks, resulting in better utilization of resources and improved operational efficiency.

5. Financial Inclusion: The merger would help in achieving the objective of financial inclusion by providing better banking services to rural areas.

6. Regulatory Compliance: The merger would ensure that RRBs comply with the regulatory requirements and governance standards set by the RBI.

Overall, the merger of RRBs with their sponsor banks was seen as a positive step towards improving the functioning and performance of RRBs and promoting rural development. The recommendation of the Narsimham Committee played a significant role in shaping the policies related to RRBs in India.