RBI (Reserve Bank of India) plays a crucial role in controlling inflation in India. It uses various monetary policy tools to reduce the aggregate demand and maintain price stability in the economy. These tools are:

• Repo rate: RBI increases the repo rate, which is the rate at which banks borrow money from RBI. This makes borrowing expensive and reduces the flow of money in the economy, leading to a decrease in demand and subsequently lowering inflation.
• Reverse repo rate: RBI decreases the reverse repo rate, which is the rate at which RBI borrows money from banks. This makes lending attractive for banks, leading to an increase in the flow of money in the economy, thereby increasing demand and inflation.
• Open Market Operations (OMOs): RBI can conduct OMOs to influence the availability of money in the economy. Selling government securities reduces the money supply, while buying them increases the money supply. This helps to maintain the liquidity in the economy and control inflation.
• Cash Reserve Ratio (CRR): RBI can vary the CRR, which is the percentage of deposits that banks need to keep with RBI. Increasing CRR reduces the loanable funds available with banks and controls inflation.
• Statutory Liquidity Ratio (SLR): RBI can also vary the SLR, which is the percentage of deposits that banks need to maintain in the form of liquid assets. This tool can be used to control inflation by regulating the liquidity in the economy.

Overall, the role of RBI in controlling inflation is significant, as it helps maintain price stability, strengthens the economy, and ensures future growth.