and gdp per capita. denmark, which is de facto in the euro area, has made structural reforms in the labour market, which have proved very efficient. we are fully backing this trend of reforms. it is very important to communicate as efficiently as possible and to convince public opinion that this is a successful way to fight unemployment and promote growth. part of the needed structural reforms are sector - based and imply cross - border mergers and acquisitions. are you completely discouraged, for example, by the french government ’ s recent attitude in the suez - gaz de france case and dominique de villepin ’ s call for economic patriotism? the ecb ’ s governing council didn ’ t discuss any particular dossier relating to cross - border mergers and acquisitions. in the past, the governing council always referred to the full completion of the european single market. as a matter of principle, the governing council thinks that there is an opportunity cost associated with the non - completion of the single market. let ’ s not forget that it is not a new endeavour. the single act launched the endeavour for a single market in the mid - 1980s. in 1958, when the treaty of rome was ratified, the idea was to produce a common market of the size of the usa to benefit from economies of scale. the ambition was already clear 50 years ago : free circulation of men and women, goods and services and capital in the european union. austrian finance minister karl - heinz grasser, who is chair of ecofin during the first half of 2006, claims that all eu member states should achieve balanced budgets by 2010, what do you think about that? it is a good goal. we have always called for the rigorous implementation of the stability and growth pact. you will remember that there were calls to drastically change the rules in this domain, and even by some to abandon the pact. we have always said that the pact is a crucial element in the emu. the stability and growth pact is very much the “ e ’ ’ in emu. we have no federal government, we have no federal budget, but we have a single currency. in order to be coherent, the emu needs a stability and growth pact. the three percent threshold, which i am proud of having introduced myself in the negotiations, is not only mentioned in the stability and growth pact but is also referred to in the treaty. i often have to answer the question, whether more than three percent would not be opportune in difficult situations where an economy could

##l highs across advanced and emerging and developing economies, the inflation crisis is global. actually, it is just the face of one of the most severe food and energy crises in recent history that now threatens the most vulnerable across the globe. in response, the most widespread monetary policy tightening in decades is underway. it is the most coordinated tightening cycle in many years, and the actions are appearing synchronised because imported inflation pressures are being exacerbated by country - specific factors acting at the same time. india is being impacted by the global inflation crisis, reflecting the materialising of geopolitical risks. although it is largely driven by food and fuel supply disruptions and bottlenecks, mending supply always takes time. several steps have been taken, demonstrating that price stability is a shared responsibility between the government and the central bank, but these measures will inevitably have gestations : they will show results only over a period. to gain time for supply to respond, monetary policy has to be deployed, but it is not likely to be painless. as i stated in my minutes in the june 2022 mpc meeting, the accountability mechanism enhances credibility in the monetary policy framework, especially in its commitment to re - align inflation with its target in the event of prolonged divergences and that is of paramount importance. the wide public sensitivity to accountability works in the same direction as monetary policy in the pursuit of ensuring price stability. it shows that inflation expectations are anchored around the conviction that monetary policy will not tolerate persistent deviations from the target because it is enjoined by legislation ( not ) to do so. one final question on accountability engages public attention : what is the role of the mpc here? after all, the act enjoins the rbi – not the mpc - to write the letter on causes, remedial actions and time to return to target. will the commitments made by the rbi in the letter render the mpc on auto pilot? once again, the mpc regulations are unambiguous on this issue. the secretary to the mpc shall schedule a separate meeting as part of the normal policy process to discuss and draft the report to be sent to the central government under the provisions of the act. conclusion monetary policy is usually unsung. whenever risks surround the indian economy, the rbi rises up with everything at its command in defence of the indian economy. when the danger recedes, the rbi reposes back to anonymity, ready to rise