Monetary policy / monetary management is regarded as an important tool of

economic management in India. RBI controls the supply of money and bank
credit. The Central bank has the duty to see that legitimate credit
requirements are met and at the same credit is not used for unproductive and
speculative purposes. RBI rightly calls its credit policy as one of controlled
expansion.

“Monetary policy refers to the use of instruments under the control

of the central bank to regulate the availability, cost and use of
money and credit.”