RBI Guv should work in sync with govt or resign, says SJM

The RBI Governor should work in sync with the government or otherwise he can resign, the RSS-affiliated Swadeshi Jagran Manch said Wednesday.

The comments come against the backdrop of escalating tension between the government and the RBI over various issues.

"The Reserve Bank of India Governor should work in sync with the government or otherwise resign," Swadeshi Jagran Manch's (SJM) co-convener Ashwani Mahajan told PTI.

He also said that Deputy Governors as well as RBI office bearers should restrain from speaking in the public about any disagreements with the government.

If there is any disagreement with the government, then it should be expressed at the bank's board meeting and not publicly, Mahajan said.

He was referring to RBI Deputy Governor Viral Acharya's hard-hitting speech on Friday in which he had warned that undermining central bank's independence could be "potentially catastrophic", possible indication of the RBI being pushed to relax its policies ahead of general elections next year.

"This entire talk of central bank's independence is a western concept. It is not acceptable and feasible here. India is a developing country our main priority is employment and growth of small scale industries. RBI should stand with government on these issues," Mahajan said.

The RBI's main role is about monetary policy, which deals with stability of the economy and not its growth, he said, and claimed that the RBI does not have expertise of fiscal management.

SJM's senior leader S Gurumurthy is a member of the RBI board.

Earlier in the day, the Finance Ministry said the RBI's autonomy is "essential" and will be "nurtured", as it sought to calm investors worried by the central bank reportedly being forced to resolve differences with the Centre which has cited powers never used before.