Wednesday, November 7, 2012

Chidambaram vs Subbarao: How conflicts between govt and RBI could lead to better policy-making

Policy makers in India concede that there have often been divergence of views when it came to handling of fiscal and monetary policy.



....Such conflicts are not new in India. In fact, in 1956, one such face-off between the governor of the RBI Benegal Rama Rau and finance minister TT Krishnamachari led to the exit of the central bank chief. For a good part of the past few decades, such disagreements between monetary and fiscal policy managers were voiced in private........

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