Analyse India’s measures of money supply (M0–M3) and explain how NDTL, credit creation and the money multiplier link the RBI’s balance sheet to real-economy liquidity. (Answer in 250 words)

India’s money supply is measured in nested aggregates (M0–M3) that connect the Reserve Bank’s balance sheet with banks’ liabilities and the public’s purchasing power. Understanding these, alongside Net Demand and Time Liabilities (NDTL), credit creation and the money multiplier, is central to monetary transmission.