....With Pranab Mukherjee out of the finance ministry, the Prime Minister will also need to leverage his equation with RBI Governor D. Subbarao to bring down interest rates, give an impetus to investment and reverse the slide in the growth story. Mukherjee had an uncomfortable relationship with the RBI Governor and, despite his constant nudging, the latter, in the past one year, consistently refused to lower interest rates. Just 10 days before he demitted office (June 26, 2012), Mukherjee dropped enough hints to suggest that he wanted a reduction in interest rates, but that did not happen in the quarterly review of the monetary policy on June 18. The RBI will have to reduce interest rates to rev up the economy. It will not be an easy decision to take, for, it risks inviting the charge that it was deliberately putting roadblocks in Mukherjee's economy revival plans..........
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