Policy Rates and Tools — Mains Questions

Analyze the evolution of India's monetary policy framework from the pre-liberalization era to the current inflation targeting regime. How has this transformation enhanced the effectiveness of policy rate transmission?

Examine the role of reserve requirements (CRR and SLR) in India's monetary policy framework. How do these tools complement policy rate operations in achieving macroeconomic objectives?

Critically evaluate the challenges faced by RBI in ensuring effective monetary policy transmission in the Indian context. Suggest measures to improve transmission effectiveness.