India, Jan. 6 -- The Delhi Government on Monday signed a landmark Memorandum of Understanding (MoU) with the Reserve Bank of India (RBI), bringing the national capital under the RBI's full banking, cash management, and debt framework for the first time. The move ends decades of ad hoc financial arrangements and places Delhi on par with other states in terms of fiscal operations.

Under the agreement, the RBI will act as the banker, debt manager, and financial agent of the Government of NCT of Delhi. This will allow the capital to raise funds through market borrowings, invest surplus cash automatically, and access low-cost liquidity facilities, all within the framework laid down by the Government of India and the RBI Act. The MoU was signe...