Finance Minister Arun Jaitley on Tuesday added fuel to fire amid the ongoing conflict with the Reserve Bank of India (RBI) by saying that the regulator “looked the other way when banks gave loans indiscriminately during 2008-2014”. The finance minister was speaking at an event.
The conflict between the Modi government and the central bank reached a boiling point when deputy governor Viral Acharya, in a strongly-worded speech, recently said that undermining a central bank’s independence could be “potentially catastrophic”.
Notably, during the years in question, D Subbarao was the RBI governor until 2013, succeeded by Raghuram Rajan. Interestingly, the tussle between the RBI and the government is not new; it seems to have escalated under present governor Urjit Patel — a man who was handpicked by Narendra Modi government to replace Rajan.
Patel, who was given the mammoth task of implementing demonetisation just three months after he assumed power, was criticised heavily for his silence. Read More