The Reserve Bank of India
Reserve Bank of India was established on April 1, 1935, with the basic objective to 'regulate the issue of Bank notes and the keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage'.

The bank functions as the banking and financial operation of the government, and tenders advice to it on economic matters in general and on financial problems in particular.

The bank advises the government on public debt management and personalises the government borrowing programmes.

Monetary Regulation
The main function of the Reserve Bank, as of all the other central banks is to formulate and administer monetary policy. Monetary policy refers to the use of instruments within the control of the central bank to influence the level of aggregate demand for goods and services by regulation of the total money supply and credit.

The total expansion of money supply depends on the creation of high powered money (reverse base) and the multiplier action upon it. Through the various instruments available, the Reserve 1,3ank seeks to control both dimensions of money supply change.