The Reserve Bank of India continues to operate within a well-defined framework and retains substantial operational autonomy | Photo Credit: REUTERS
Central banks occupy a peculiar position in modern democracies. Governments spend, tax, and borrow. Central banks, through their toolkit of monetary policy, manage inflation, preserve confidence in the currency, and safeguard financial stability. Their credibility rests on maintaining a degree of distance from the fiscal compulsions of the governments they serve.
Recent developments surrounding the Reserve Bank of India (RBI) invite a closer examination of that relationship.
Published - June 18, 2026 08:30 am IST