....The inter-linkage between the fiscal and monetary policy is well-documented in the Indian context. In the initial years, the RBI used to subscribe to government deficits through issuance of ad-hoc treasury bills that led to automatic monetisation of government debt through increase in reserve money. Later, rapid strides were made to reduce the fiscal dominance of monetary policy by introducing a system of "ways and means advances" and even later by prohibiting the RBI from subscribing to primary ..........
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