The Reserve Bank of India (RBI) acts as the central bank of India and is responsible for: A. Fiscal policy formulation B. Monetary policy formulation C. Industrial regulation D. Foreign policy
Question
The Reserve Bank of India (RBI) acts as the central bank of India and is responsible for: A. Fiscal policy formulation B. Monetary policy formulation C. Industrial regulation D. Foreign policy
Solution
The Reserve Bank of India (RBI) is responsible for B. Monetary policy formulation. The RBI controls the monetary policy of the Indian rupee. It is not responsible for fiscal policy formulation, industrial regulation, or foreign policy. These areas are typically managed by the government, specifically the Ministry of Finance, the Ministry of Industry, and the Ministry of External Affairs respectively.
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