Letter to BS: RBI, govt shouldn't make public their differences on issues

While the RBI is accountable to the government, these avoidable public statements create the perception that its ability to perform its stated functions is being slowly eroded

This refers to “Jobs, tolerance, protection of institutions key issues: Rajan” (January 23). Often perceptions about the degree of autonomy enjoyed by important institutions is as important as the reality. Over the years, there has been an increasing tendency on the part of the mandarins of the North Block to stray into the Reserve Bank of India’s (RBI) regulatory domain. In the UPA II period, the then secretary of Department of Financial Services (DFS) used to issue circulars to public sector banks (PSBs) containing instructions that often contradicted the regulatory instructions of the RBI on those subjects. In the present