With reference to Jaimini Bhagwati's excellent analysis in his article, "Central bank's autonomy and accountability" (September 15), it is comforting that the media has taken note of this year's Reserve Bank of India (RBI) Annual Report and that several aspects of the central bank's role and responsibilities are being debated. This is in contrast to the near-blackout of the RBI Annual Report by sections of the media and analysts in 2014-15.
Traditionally, the RBI uses its annual report to provide a comprehensive assessment of its activities during the year and to mention the challenges it faces in performing the mandated functions.
The 2014-15 report had the Raghuram Rajan touch: It contained a separate chapter titled "Governor's Overview" in which the then RBI governor minced no words in expressing his concerns about fiscal and monetary policies. Once submitted to the government, the report is available in the public domain and Parliament gets an opportunity to seek more information from the central bank.
It is to the credit of successive governments at the Centre that compared to other regulatory and supervisory bodies and public sector undertakings, including public sector banks, the RBI had efficient teams at its helm during the most part of its existence, even though the tenure of its governors and deputies were not long enough many a time.
The three-year period that has just ended proves that more efficient leadership can bring out the best in Team RBI. Let us not get carried away by former RBI governor D Subbarao's laments about appointments. There is no denying that continuity at the top through longer tenure of governors and their deputies will be beneficial. But within the RBI talks about its autonomy hovered around policy issues, including monetary policy management and government support in supervision of banks, especially those owned by the government. On and off, the finance ministry gave the impression that PSBs were nothing but conduits for financing government programmes while forgetting the source of their resources.
The RBI has clarity about the role of the financial sector in economic development. This has come through in its reports and has been elucidated in the speeches of its governor and other executives in the past few years.
M G Warrier, Mumbai
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