IMF's Advice and RBI's Rebuttal

International Monetary Fund (IMF), under its Article IV of the Articles of Agreement, signed in 1944 by the original 29 member countries as well more by later, (now grown to 190) sends its staff, to its member countries for a threeweek visit annually for major economies, which contribute a sizeable proportion of world's GDP, and once in every two years for small economies.

- Dr. T. K. Jayaraman

The purpose of the Mission, known as Article IV Consultation Mission (the Mission) is to undertake a comprehensive review and assess the immediate past economic performance and offer advice on stabilizing their economies, preventing financial crises and improving living standards. The Mission would also seek to "identify areas of divergence away from and convergence towards orderly growth of the member countries for promoting freer trade with relatively less restrictions on trade and as needed as possible between nations and for fostering free market forces without restrictions on supply and demand as well for greater mobility of capital and labour between nations".

The Mission collected as usual economic and financial information, and discussed the country's economic progress and policies with the top officials in the Ministry of Finance and Reserve Bank of India (RBI). The staff prepared a draft report for discussion by the Executive Board. At the conclusion of the discussion, the Managing Director IMF, as Chairman of the Board, summarizes the views of Executive Directors, which was transmitted to the country's authorities.

Findings of Mission