What are the challenges the RBI could face in withdrawing the expansionary policy measures announced in response to the economic disruption caused by pandemic. 10 marks
Mentor’s comment- https://www.thehindu.com/opinion/lead/planning-an-exit-out-of-the-easy-money-regime/article33545050.ece In the intro, mention how RBI had stepped in to deal with the economic fallout of pandemic through various measure. In the body discuss various challenge-inflation control, avoiding taper tantrum, maintaining stability of rupee etc. Conclude by mentioning the need balancing inflation with concerns with economic recovery.Â