Letters: RBI's independence

With reference to Anup Roy's report "Govt must protect central banks' independence, says Rajan" (July 27), no one can disagree with Reserve Bank of India (RBI) Governor Raghuram Rajan's remarks. He must be lauded for making intelligent use of data to counter the usual sentiments from vested interests and veiled arguments put forward by his critics that not cutting rates would spur rapid growth.

He justifiably argues that despite public commentary against inflation and its effect on weaker sections of society, there seems to be little anxiety about inflation so long as it is in the high single digits. I fully endorse his views.

Sadly, there have been several attempts by the government in the recent past to "circumvent" the independence of RBI. And, it made good use of its Parliamentary majority while amending the RBI Act. A case in example is the "modified" composition of the Monetary Policy Committee, which virtually "robs" the governor of powers to take independent decisions.

Needless to say, whenever any RBI governor tries to question the policies of the Centre he is shown the door. Rajan may be an example as he tried to lock horns with Arun Jaitley over his Monetary Policy stance. Incidentally, it is surprising that the Centre is taking so long to finalise Rajan's successor. It's a different matter that a new name gets added to the list of probables every day. The nation is eagerly waiting for the historic announcement.

S Kumar, New Delhi

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