Critically analyse the role of the velocity of money and banks’ Net Demand & Time Liabilities (NDTL) in shaping monetary transmission and inflation–growth dynamics in India. (Answer in 250 words)

Velocity of money—the ratio of nominal GDP to money supply—captures how quickly money changes hands, while banks’ Net Demand and Time Liabilities (NDTL) reflect their deposit funding base. Together they shape liquidity, credit pricing, and the effectiveness of monetary transmission in India.

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