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Reconstituting RBI - A caustic perspective on India

Aug. 31st, 2005

06:05 pm - Reconstituting RBI

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The latest issue of Economic and Political Weekly has an article on reconstituting RBI. I am unable to get a URL to the article. I think they update the site with a lag. You'll have to run a search for the author's name.

The article worries about how RBI has been immune to reform. The article is by Anand Chandavarkar. EPW generally has a poor reputation of seeking out leftist authors, and EPW publishes a lot of rubbish, but occasionally they print normal authors and this one is worth reading.

The article talks about the "attrition of core central banking", as RBI has picked up additional functions ranging over a bizarre range of activities, most of them inducing conflicts of interest with each other. The author argues that it's time to reform RBI, refocusing it on a small core central bank function, with legal autonomy and associated accountability.

The next article in the same issue is a bland article by a Janak Raj of RBI on the subject of regulatory architecture in India. Being an employee of RBI, his anodyne piece is calculated to not offend anyone who works for RBI. It looks like Chandavarkar is a scholar while Raj doesn't seem like one.

Update: New Economist picked this up, and his entry adds value compared with the above.