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Evaluation of RBI

edited April 2015 in Miscellaneous
With the Govt set to take away public debt mgt function from RBI, how do you think RBI has performed its functions as a central bank?
I am thinking in terms of a critique of RBI, is it succeeding in its mandate, what changes should be made, should it be tampered with etc etc
Anyone pls?

P.S: If anyone has a link to a good article pls do tell. Google is throwing up nothing mainly bec i dont know how to phrase my query :)

Comments

  • In my view whatever reforms govt is bringing is not based on sound economic policies, its a political motivated decision. Many will differ with me . :)
    @Nuralain thanks for telling it in brief .
  • With the Govt set to take away public debt mgt function from RBI, how do you think RBI has performed its functions as a central bank?
    I am thinking in terms of a critique of RBI, is it succeeding in its mandate, what changes should be made, should it be tampered with etc etc
    Anyone pls?

    P.S: If anyone has a link to a good article pls do tell. Google is throwing up nothing mainly bec i dont know how to phrase my query :)
    India need huge investment in infrastructure, infrastructure has huge gestation period. Bank can't meet tat need due to already high NPA and asset liability mismatch. So india created company like IFC to float bond in market to meet tat need ,but now the question is how to get investment in bond.
    Reason for bond market underdevelopment is the regulation of interest rate by RBI.RBI also manage govt debt through bond.so conflict of interest.
    Its like I want money from u with the rate of interest decided by me not market.
    So separate debt agency will help in bond market development, reducing conflict of interest .
    I explain it with specific infrastructure example .u can generalise it.
    Add technical point from BN Krishna committee , RBI committee.
    This whole thing is done to bring more transparency. For me ,it doesn't mean tat RBI has failed .
  • Thank you everyone for chipping in. It makes a lot more sense now.

    I guess the biggest problem with taking away RBI's functions is the suspicion that the Govt of the day may not act in the best interest of the economy. There may be short term or electoral factors in play.

    Thanks again!
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