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This is with reference to the editorial "Issues of autonomy" (Business Line, October 7). As pointed out, the country is at the right time to consider something like the autonomy of the apex bank through consensus. But simple political or politicians' consensus may not suffice.

As the RBI plays a crucial and vital role in governing the country's economy, it is necessary to have debates, interactions and introspections among experts in the economic sector, representatives of the trade community and politicians before coming to a conclusion.

Also, the various parameters of the proposed autonomy should be discussed threadbare. The call of Dr Bimal Jalan, who was the RBI governor during testing times, should be heeded to. The apex bank can take vital decisions purely on the basis of economic science — free of political concessions or considerations — if it is let free of governmental control.

In the present era of mounting fiscal deficits, the apex bank has to consider the fixation of interest with due considerations of the market price levels. As the RBI has to control the price levels in the economy, it has to exercise utmost care in lowering or raising the interest rates. With the credit take offs in banks being low, the RBI cannot consider a hike on interest. Thus, RBI's role is crucial, and autonomy is the best weapon that the Centre can give it. The Government has to act swiftly.

C. P. Velayudhan Nair

Kochi

***

Though the Fiscal Responsibility and Budget Management Bill mandates the elimination of the Centre's revenue deficit by March 2008, it cannot be achieved without the active cooperation of the States. In this regard, it is heartening that three States have passed similar Acts to limit their own fiscal deficits. It is essential that all other States follow suit.

The Centre and the States should forget their political differences and cooperate in reducing the fiscal deficit. They should be proactive in reducing the fiscal deficit and removing structural impediments to high yielding investment priorities.

C. Ramesh

Keeramangalam (TN)

Letters to the editor and contributions can be sent by e-mail to: bleditor@thehindu.co.in

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