•Because that means we are not shoving enough money in the economy.

Yes.

•And confidence.

I don’t think that will happen. Because of the fiscal deficit, the government has a very substantial amount of borrowing to do and that’s a good thing. That borrowing will have to be accommodated by a supportive monetary policy. Now the way you do that, you can do a little side deal with the Reserve Bank that it picks up your securities or the Reserve Bank can pump more money into the system and then the system will pick up.... that’s a matter of detail. It is quite clear that monetary policy has to be supportive. We mustn’t allow interest rates to rise.

•If the government wants another Rs 50,000 crore, RBI just has to lower CRR by 100 basis points and that much money is in the economy.

Yes, that is certainly an instrument they can use. Both the CRR and interest rates, the policy rates are instruments available with the RBI. They have been using them and the good thing is that they have a lot of scope. So I think on the monetary side we have all the flexibility we need.

•I know you don’t speak for the RBI and you should not, but do we expect the RBI, or do we hope the RBI will take a more positive, more proactive view of the situation?

I hope, as you said, they are watching this TV interview and hearing what you say.

... contd.