The Story of the Reserve Bank of India

Raghuram Rajan, the former governor of the Reserve Bank of India (RBI), had once famously remarked, ‘We are neither hawks, nor doves, we are owls.’ However, the RBI is not an ordinary owl. It’s a very wise owl with immense powers and responsibilities. There can be no argument that the RBI is not only among the very few islands of excellence when it comes to the institutions of the government of India, but also worthy of pre-eminence among all the other national banks in the world. Often described as the most conservative institution in India, this moniker has served the RBI well at all times. In recent years, however, the controversies like personality-driven narratives and some policy decisions such as demonetization, in which the RBI may or may not have had a big say, have come under intense media scrutiny. This trend is not new, though. Through its more than eight decades of history, and twenty-four governors, right from Osborne Smith to Urjit Patel, the RBI has always faced constant pressure from different governments to prioritize growth over monetary and economic stability.