Why the massive expansion in RBI's balance sheet isn't really extraordinary

As a share of nominal GDP, the balance sheet is well within the levels of the past few years; yet it could influence every sphere of economic activity in the country

The Reserve Bank of India presented its annual report for the accounting year 2019-20 in the last week of August. One of the key insight it holds is about the expansion of the central bank’s balance sheet by a massive 30 per cent, from 2018-19 to 2019-20. In absolute terms, the size of the balance sheet grew from Rs 41 trillion to Rs 53.3 trillion in a year. 

At the outset, this seems to be an unprecedented expansion, especially if we consider the fact that in 85 years of its existence, RBI's balance sheet grew to Rs 40 trillion, and that