MUMBAI – India’s central bank needs to be independent to improve the macroeconomic stability, and policies need to be rule-based, the Reserve Bank of India’s (RBI) Deputy Governor Viral Acharya said on Friday.
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“To secure greater financial and macroeconomic stability, these efforts need to be extended to effective independence for the Reserve Bank in its regulatory and supervisory powers over public sector banks,” Acharya said in a speech, the text of which was posted on the RBI website.
Acharya’s comments come on the back of government efforts to carve out regulatory powers related to payments and create a separate regulator. Government officials have also been calling for the RBI to relax lending restrictions for some banks that have a low capital base.