The current regime seems neither suited to India’s developmental needs nor as effective as claimed
The first ever monetary policy committee (MPC) of the Reserve Bank of India (RBI) has held its last meeting. By and large, tributes have poured in for its believed role in reining in the rate of inflation in India. Simultaneously, given the recent spike in the rate of change in the consumer price index (CPI), analysts have reconciled themselves to RBI not cutting its policy rate till inflation falls. This shows the stranglehold of inflation targeting (IT) on our policy framework and mindsets. Both are unhealthy for India.