Making his presentation before the Royal Commission on Indian Currency and Finance that visited India in 1924-25, Dr BR Ambedkar warned of discordant elements that could play havoc with India’s currency and financial system. Besides ‘foolish businessmen’ and ‘foolish administrators,’ Ambedkar prophetically identified the political class among the coterie:
…we have amongst us equally foolish politicians desiring to advertise themselves as friends of the people. …Any of these three may bring about a calamity in the guise of a blessing, and all this in sheer ignorance of the principles of currency.
The Report of the Commission – mandated to examine the financial system and to suggest the reform of the Indian currency – led to the establishment of the Reserve Bank of India in 1935, to separate control of currency and credit from the government.
Looking back on Dr Ambedkar’s submissions, one can only marvel at his farsighted insights into the working of the economy, the monetary system, the banking sector, and their interplay with the political and administrative leadership as well as the business community.
Fast forward to 2018, we reach a situation where Ambedkar’s warnings are coming true.
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