When the Central Government of India get ₹ 1.76 lakh crore from Reserve Bank of India, then everyone opposed it directly or indirectly. And some people related it with the case of Argentina. So, today we'll get deep into this and look for the reason.
Argentina is a country in South America, covering most of the Southern portion of the continent. It is the World's 8th largest country. In Argentina, mostly 2 out of 3 years remains in recession. Officially, Argentina has a huge debt of $321 billion (according to 2017 data).
In 2008, Argentina's President, Cristina Fernandez de Kircher forced the governor of Central Bank of the Argentine Republic(Central Bank of Argentina) to give US$6.7 Billion to the government for paying their debt. But Martin Redrado(Central Bank Governor at that time) didn't agree on that and opposed it directly.
Then, he got dismissed by the President on 7 January 2010. Then Mario Blejer(who had expressed support for the measure) was appointed as the Governor in the Central Bank of Argentina. And after that, the Argentina Government got the funds and they used it for repaying their loans.
Similarly in India, the same series of events happened in recent times. First, the central government had a dispute with Raghuram Ji Rajan and then he resigned from Reserve Bank of India. After him, Dr. Urjit Patel also resigned from RBI.
At that time, Raghuram Ji Rajan had given one statement about RBI that I want to quote here.
I think this is something all Indians should be concerned about because strength of our institution is really important both for growth and sustainable growth in equity and the economy
Then the government chose Shaktikanta Das as the RBI Governor, who had justified the government's decision of Demonetisation. And this decision somewhat leads that now RBI has come under the control of Government.
Now in September 2019, RBI has decided to give ₹1.76 lakh crores to the Central Government of India on the request of Bimal Jalan Samiti.
Why? Even the Government doesn't know.
This whole scene is somewhat similar to Argentina's Economic History. And today, everyone knows what had happened in Argentina.
We must have to consider Dr. Subramanyam Swami's tweet here...
So, the Government of India should take reform measures to overcome this economic problem.Get ready to say good bye to ₹ 5 trillion if no new economic policy is forthcoming. Neither boldness alone or knowledge alone can save the economy from a crash. It needs both. Today we have neither— Subramanian Swamy (@Swamy39) August 31, 2019
Why is India's economy compared to ruined Argentina?
Reviewed by Dhruval
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9:55 AM
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Too good sir..You have great insights in this field.
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