REALIGN POLICIES OF RBI TO CHANGING ECONOMIC REALITIES

UNDER the new leadership, the Reserve Bank of India (RBI) is 'undoing' some of the measures taken during the previous regime to allow the banking system to breathe easy.

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By the time Sanjay Malhotra took the reins of the central bank from Shaktikanta Das in December last year, India's growth had slowed down to 5.6 percent, and the equity market was in a tight bear grip. The liquidity in the banking system was tight, and regulatory tightening was slowing down credit offtake. Many analysts blamed RBI's overzealous stance on curbing inflation for the overall economic slowdown.