At 11am on Tuesday, RBI governor Raghuram Rajan presented the new fiscal year’s (2016-17) first monetary policy.
At 7pm in the evening there were four young ‘governors’ who also unveiled a detailed monetary policy, complete with assessments on inflation and liquidity.
The second event was part of a Reserve Bank-organised national level competition called ‘RBI Policy Challenge’, targeting undergraduate and post-graduate students of all disciplines. The quiz challenge held at RBI headquarters was organised to test interested students on financial and monetary matters and to popularise the role of the RBI.
The policy challenge is a first-of-its-kind initiative by the RBI, which saw participation from 260 institutions, through essays at regional and zonal levels.
Four teams were chosen from the initial round of writing on a monetary policy-related topic, and were asked to make a 15-minute presentation before a panel headed by the governor himself.
IIM Raipur and Delhi-based IIFT won the challenge after presenting a mock policy in the finals. The policy announced a 0.50 percentage point rise in repo rate.
Interacting with the teams, the panel, which also had deputy governor S S Mundra as a member, asked a selected team whether they had considered the political ramifications of their model policy.
Rajan highlighted the importance of good framework and articulation as key aspects of policy making. “Sometimes what we certainly can’t do is present regression in public. We do a lot of analysis. We develop our logic for what we need to do and then when we go out we say this is what we are going to do,” Rajan said.
Working for the RBI may look glamorous from the outside, but “there is lot of pressure,” he added.
Praising the free hand that India has in policy making, Rajan said: “There is also in this country tremendous space for you to exert your independence. Of course you have to articulate why you are using your independence the way that you are using.”