Silencing the RBI

Being a central banker is a thankless job. This is especially true in developing economies, such as India, where the central bank is not legally independent. This shortcoming makes the bank vulnerable to government interference at multiple levels, including the formulation of monetary policy. The finance ministry’s recent decision not to extend Subir Gokarn’s three-year term as the Reserve Bank of India’s ( RBI&select=1 target=_blank style=text-decoration:none;cursor:hand;>RBI’s) deputy governor, which ended recently, is a good example.

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