The Reserve Bank of India’s (RBI) press release after a marathon nine-hour board meeting indicates that the central bank has prevailed on most of the substantive points.
That said, there are still signs in the press release that indicate that the RBI has lost some of its autonomy to the board.
Simply put, the RBI's victory is merely a strategic postponement of curbs on its autonomy. The Ideological war has probably been won by the government in terms of its assertion that the board shall decide substantive matters.
If for argument’s sake a new government comes to power after the May elections, that’s no guarantee that the current board will be restrained from wresting control of the management of the RBI. Chances are the new government having tasted blood will only replace the current ideologues with its own camp followers.
Is there a danger that RBI, as we know it, is itself in a danger of fading? The jury is out.