The finance ministry has blamed the Reserve Bank of India for failing to provide a credible monetary policy for nearly six years between 2007 and 2013. “For a long time, the Indian economy has been drifting without a credible monetary anchor. Since late 2013, however, this has been laudably reversed,” said the Mid-Year Economic Analysis 2014-15 that was tabled in Parliament on Friday, adding that it has now been restored through important actions taken by the government and the RBI. “That has been reversed since the end of 2013, with real interest rates climbing back into positive territory . ,” the document stated. The report, which was prepared by chief economic adviser Arvind Subramanian noted that this loss of credibility was reflected in the fact that real policy interest rates were consistently negative at a time when inflation was persistently in the double digit territory. YV Reddy was Governor of the RBI from September 2003 to September 2008 and was succeeded by D Subbarao, who remained in office till September 2013. Raghuram Rajan took over as 23rd Governor of the Reserve Bank of India on September 4, 2013.
