The Reserve Bank of India (RBI) uses various methods to control inflation in the Indian economy.

• Monetary Policy: The RBI uses monetary policy to control the money supply in the economy. This includes regulating interest rates and managing the availability of credit to prevent excessive borrowing.
• Open Market Operations: The RBI buys and sells government securities to regulate the money supply in the economy. When it sells securities, it reduces the money supply, which helps control inflation.
• Bank Rate: The bank rate is the interest rate at which the RBI lends money to commercial banks. By increasing the bank rate, the RBI can control the supply of money, which can help control inflation.
• Reserve Ratio: The reserve ratio is the amount of money that banks are required to keep on reserve with the RBI. By increasing the reserve ratio, the RBI reduces the amount of money banks can lend, which can help control inflation.
• Inflation Targeting: The RBI sets an inflation target and uses various methods to achieve it, such as adjusting interest rates and money supply.

Overall, the RBI uses a combination of monetary policy tools to regulate the money supply, control inflation, and maintain economic stability.