RBI autonomy fundamental, we have to maintain it: Bimal Jalan

 A day after former RBI governor Y V Reddy flagged ‘reputational risk’ being faced by the central bank, another former governor Bimal Jalan on Tuesday said its autonomy is fundamental and needs to be maintained.

“...the autonomy of the RBI -- that is a very fundamental fact and we have to maintain it and I hope the government would give attention to that part also,” Jalan said.

Reddy regretted on Monday that the institutional identity of Reserve Bank of India has been damaged and stressed that for central bank “reputational risk is worst risk”.

Jalan said one would have to wait and see how the relationship between the government and RBI develops which ultimately is a matter of coordination. “It is a matter of consultative approach and it is too early to be able to say how it will grow in...autonomy of the RBI and autonomy is not what you call independence,” he said.