it would be to learn to manage both economic and regulatory policies in a globalising world.
"Dr Jalan, as the Governor, showed extraordinary competence and leadership in insulating India from the impact of the Asian crisis in the mid-1990s. Dr Reddy had the courage of conviction to remove the metaphoric punch bowl before the party got wild," he said.
He said yet the global financial crisis was so virulent that it affected virtually every country in the world. Did the Reserve Bank learn from the sagacity of Dr Jalan and the wisdom of Dr Reddy to manage the current crisis?
"Governor-designate Rajan, who will take over from me early next month, is here in the audience. The challenge for you, Governor Rajan, will be how you will use your formidable intellect, scholarship and global experience to shape the Reserve Bank as a knowledge institution that will set standards for how an emerging economy central bank should manage macro economic policy in a globalising world.
"I am aware this is history in the future but history that will nevertheless be historic," he said.
Asking a "cliched" question whether history repeats itself, Subbarao said, "Has RBI history repeated itself? That is a judgement call. But some issues do keep repeating in RBI history. I will give just one illustration."
Citing the issue of gold, the Governor said documents about 35years ago RBI got into a controversy over its auction of gold.
Again in 1991, there was a heated, if also emotional, debate in the country when the RBI pledged its gold reserves to tide over the balance of payments stress.
"It will be interesting to conjecture on how history will judge the purchase of 200 tonnes of gold by the Reserve Bank from the IMF in 2010, and its more recent policies to restrain imports of gold?" he said.
Jalan, who was Chairman, Advisory Committee of RBI History Volume 4 (1981-1997), said the writing of history was a difficult process in which the History Cell of RBI played an important role. It took three to four years to complete the task.
Referring to the various eras