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RBI vs Govt: Will the Centre have its way by invoking an 83-year-old rule?

The government can still have its way with the RBI by invoking a rule that hasn't been used in the central bank's 83-year history

RBI vs Govt

India’s monetary policy makers and government officials will meet Monday in a board meeting that promises to be anything but its usual dull affair. Locked in a power struggle over how much capital the central bank needs and how tough its lending rules should be, a trained accountant parachuted into the Reserve Bank of India’s board by the government in August may be key to whether a compromise can be found or whether the already public spat turns even uglier. Swaminathan Gurumurthy, a chartered accountant turned newspaper columnist, has set the tempo by chiding ...