Newsmaker: Yaga Venugopal Reddy | Business Standard News

Newsmaker: Yaga Venugopal Reddy | Business Standard News


The short article crisply excellently
covers a period in Reserve bank of India’s history which will be looked back
for guidance by economists and financial analysts trying to understand the
inter-dependence of fiscal and monetary actions in future years.
The contours for the
present harmonious relationship between North Block(Finance Ministry) and Mint
Road(RBI) –  the higher level of frictions
during Chidambaram-Subbarao era was an aberration- were laid down during Dr Y V
Reddy’s tenure in RBI,  which was in fact
a continuation of the relationship between R N Malhotra and Dr Reddy when the former
was in RBI and the latter was still in the Finance Ministry.
Besides initiating
measures to build up India’s foreign exchange reserves almost from naught, Dr Reddy
also argued for a strong RBI Balance Sheet. He supported raising the total
reserves of the central bank to 12 per cent of the size of the balance sheet
and in practice, during his governorship, took it to a level of 11.9 per cent
by 2009.
The confidence in what he
writes or says, in the expression “Read my speech. I wrote it myself” is
perhaps matched by that of the present RBI Governor Dr Raghuram G Rajan who - also writes his speeches himself and- effectively uses the advantages of his
position to keep economic policy on the right track by giving right signals.

M G Warrier, Thiruvananthapuram


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