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This is with reference to “End of easy money, says RBI” (Business Line, October 28).

With the ‘recovery’ light located at the ‘end of the tunnel’ of ‘recession’, the RBI’s cautious approach to a switchover from ‘easy money’ to ‘rationing’ of ‘scarce resources’ is welcome.

With repo, reverse repo rates and CRR left ‘untouched’, the RBI has succeeded in refraining from causing ‘financial panic’ in the market, yet imposing tightening of credit availability through commercial banks.

Indirect mopping of surplus funds in the market is surely the ‘onus’ of the RBI as an ‘apex’ body of all commercial banks.

Export credit refinance squeezing, withdrawal of repo facility of special 14-days and the withdrawal of special refinance facility to scheduled commercial banks introduced a year ago, are all part of the ‘behemoth’ exercise to instil ‘financial discipline’ in the country.

Tackling the ‘spiralling’ effects of inflation is a much larger issue and should be the RBI’s top priority.

Ashok Jayaram Bangalore

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