The United Progressive Alliance government, which yesterday sounded the poll bugle by announcing a partial roll back of LPG reforms, just got a reality check from Reserve Bank of India Governor Raghuram Rajan.
Hours after the government announced the decision, made after an impassioned plea made by Congress vice-president Rahul Gandhi, Rajan has reminded that by taking such a step, the government is "expanding misdirected subsidy". “We need to spend on important things that we are not spending on,”
Rajan said in an exclusive interview with CNN-IBN’s Karan Thapar. He also discussed a host of issues including the recent Urjit Patel committee report on monetary policy, which started off a debate on whether inflation targeting should be made the central bank's mandate, and the Federal Reserve’s decision to scale back its monthly bond-buying for the second time.
The governor said one of the recommendations in the report recently submitted by a panel led by the central bank’s deputy governor Urjit Patel – to create a dedicated committee to take monetary policy decisions – would enhance the credibility of the RBI. “A monetary policy committee would create an institutional structure that would help take good decisions and would send a signal that the RBI is working on its mandate,” he said. Read more..
Source: Hindi News
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