That the relationship between the ministry of finance and the Reserve Bank of India is far from harmonious was clear last year itself, when the finance minister made the following statement: “Growth is as much a challenge as inflation. If the government has to walk alone to face the challenge of growth, then we will walk alone.” The minister’s open plea, made many times, to reduce interest rates, was not heeded by the RBI and hence the minister’s displeasure. The debate around the First Quarter Monetary Policy 2013- 14 statement, made by Governor Subbarao on July 30, provides ample evidence to demonstrate that this relationship has not improved and that the minister will have to walk alone to reach his goal..........is clear. Crosstalk doesn’t help.........
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