Oblivious to the other meaning of the date, the Reserve Bank of India (RBI) was set up on April 1, 1935 because the financial year starts then. So it is celebrating its 90th, well, what? Birthday or anniversary?
The distinction is a fine one, as VK Sharma, former Executive Director, and a stickler for accuracy, always points out. He says people, especially Indians, often confuse the one with the other.
One of his favourite peeves is whether, 365 days after being born, it’s the baby’s first birthday or first anniversary. But happily for him, the RBI has managed to get it right. It is indeed the RBI’s 90th anniversary, and not its birthday.
The Prime Minister is attending it. That’s good because amongst all the institutions that serve our country, the RBI stands out because it stands up to the government as no other institution does.
The best thing is that it’s all done very quietly, without fuss. Well, it was at least until recently, when two successive governors broke the tradition: one by talking too much and the other by not talking at all.
The current incumbent, Shaktikanta Das employs calm diplomacy. It works.
Of course, a great deal depends on the personality of the finance minister. Tamil finance ministers, in particular, of whom India has had several, have always managed to step on the RBI’s tail.
From TT Krishnamachari in the 1950s to P Chidambaram more recently, irritation with the RBI has been evident. TTK even bawled out a governor in public.
But Nirmala Sitharaman has been extra careful in avoiding confrontations, at least publicly. This is a good strategy because the RBI is a repository of economic talent like no other institution in the country. That’s why aggressive ministerial behaviour reflects badly on impatient finance ministers.
I hope the Prime Minister emphasises this aspect. Ego tussles over central bank ‘independence’ vs sovereign ‘boss’ end badly for everyone.