Once in RBI chair as Governor, one cannot erase the footsteps of all
predecessors, as RBI has no political agenda and it has only the mandate
to maintain the value of rupee, monetary and financial stability, contain inflation and provide adequate
support to growth in the over all interest of the economy. This is what
Dr Rajan also did through his monetary policy review though he has not
even completed four weeks after taking over charge as Governor and lot
of expectations were there from him from the Government, markets and corporates. Traditionally and historically, the
Governors do provide support to the Government and facilitate the
economy to grow but they can and will never be a party to the
Governments' profligacy and ineffective economic policies leading to
catastrophic economic conditions as we see it today. This is clearly a
message to the Government that inflation needs to be brought down first
for any other improvements in the economy. Low inflation itself will
lead to better savings,investment,growth and employment. This is the
theory successfully pursued world over if people's welfare is the objective of the Government. The policy from the new Governor clearly demonstrates that RBI is perhaps the only and unique institution which cannot
be easily pressurized to dance perfectly to the tunes of the Government.
Dr.T.V.Gopalakrishnan
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