Here's why Subramanian Swamy is wrong in criticising RBI Governor Raghuram Rajan
Here's why Subramanian Swamy is wrong in criticising RBI Governor Raghuram Rajan: Because of Rajan's policies, the banking system has mustered enough courage to disclose their toxic assets...
"Despite the fact that he will be in office for probably the next few months, Rajan has decided to take the bull by its horn by taking on the highly leveraged and politically connected industrial groups. Rajan will no doubt be feeling political pressure against some of the initiatives he has taken.
But credit has to be given where it is due. Rajan, as an economist and a government servant, has balanced his job very well. Swamy as a fellow economist should see through the political rhetoric and recognise the economist in himself."
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If he doesn't opt out, in all probability, Dr Rajan will stay @Mint Road fora longer period than most of his predecessors. This makes an analysis of Subramanian Swamy's frequent laments about RBI Governor irrelevant. Public memory is short. Swamy had sometime back made the demand for 'removal' of Dr Rajan and wished Dr R Vaidyanathan be his replacement. Perhaps the learned economist forgot it was not a 'political' appointment.I had, inter alia, observed in an article written on the subject during August 2013 (The Global ANALYST, September 2013) when Dr Rajan's appointment as RBI Governor was reported in the media, as under:
“The only negative in the whole affair is, as on several occasions in the past, once again GOI has opted for a short-term appointment. This time it should have been for a five-year term in the first instance itself. We are not privy to the information as to whether the decision to appoint Rajan for three years was because of a casual ‘cut & paste’ from previous appointment orders or because GOI thought, if friction between RBI and GOI persists, changing RBI Governor more often is a soft option. As someone in the media already observed, the flip side is, if things do not go well, Dr Rajan could choose an assignment anywhere, a choice, many in top positions in India do not have.
Ideally, RBI Governor should have an average tenure of five to 10 years. If such a norm was followed, Dr Rajan would have been perhaps the 15th Governor of RBI. Now he is 23rd! All Governors who have stayed in office beyond 4 years have contributed to the strength of the central bank.”
Quoted myself, in the context of continuous effort by vested interests to destabilise RBI.
M G Warrier