No turf war: FM Sitharaman, govt and RBI on same page on cryptos

Finance Minister Nirmala Sitharaman said there is mutual respect for each other's domains and priorities while keeping the nation's interests in mind.

Union Finance Minister Nirmala Sitharaman on Monday said her department was in complete agreement with the Reserve Bank of India on all issues, including cryptocurrencies. She stated mutual respect for each other's domains and priorities while keeping the national interest in mind.

As per ANI, Sitharaman said that on every issue, including crypto, they work in harmony, respecting each other's domain. Within her department and RBI, there is no turfing, and they are working in the nation's interest. 

Adding further, RBI governor Shaktikanta Das said the issue of cryptocurrency is being discussed internally between the central bank and the government. Das said they had discussed all of their concerns with the government. They didn't elaborate further. 

While presenting the Union Budget on February 1, Sitharaman said the RBI would issue digital currency in 2022-23 using blockchain technology. She said that it would have a significant impact on the economy. In addition, the government proposed amending the RBI Act to include central bank digital currency (CBDC) alongside traditional banknotes.

Recently, Das stated that private cryptocurrencies pose a threat to the macroeconomy and financial stability, undermining the central bank's ability to deal with challenges on both fronts. In a message to investors, Das stated that such assets have no underlying, "not even a tulip."

Meanwhile, while speaking about inflation, the RBI chief said focusing on the momentum of inflation from last October onwards in India, it's a downward slope. He said due to statistical reasons, the base effect, that higher inflation has occurred, particularly in the third quarter 

Das said that the same basic effect would manifest itself in various ways in the coming months. Today's inflation figure is expected to be close to 6%. That should not come as a surprise or cause concern because RBI has considered it.