Such a shift was gradual and a logical outcome of measures taken during the reform period since the early 1990s. The switchover to a multiple indicator approach provided necessary flexibility to respond more effectively to changes in domestic and international economic environment and financial market conditions.
In the context of monetary policy making, let me highlight some recent developments: First, the availability of instruments to manage, in the context of large capital flows and sterilisation, has been strengthened with open market operations through Market Stabilisation Scheme (MSS), which was introduced in April 2004.