Central banker missing in action as India escalates war on cash

Central banker missing in action as India escalates war on cash: As India undergoes the world's biggest currency overhaul in decades, one official is noticeably absent: central bank Governor Urjit Patel...

Demonetization worries, Bloomberg style
The Bloomberg story filed by Vrishti Beniwal & Anirban Nag captioned “Central banker missing in action as India escalates war on cash” (Business Standard, November 24) , following closely on the heels of a BBC lament about how India will handle 20 billion pieces of useless currency notes, is interesting reading. Let us not underplay the anxieties of external agencies, though they have only pedestrian interest in our real problems. Let us go by the same priorities listed in the report.
First, RBI Governor has spoken just only once, since November 8 announcement of demonetization. Earlier, someone had researched and found out that during the entire 2 years plus tenure as Deputy Governor, Urjit Patel had made only one public speech against the tally of fifty-plus, posted by one of his colleagues and two dozen posted by his immediate predecessor Dr Raghuram Rajan. The report says, a ‘powerful’ bank union has called for Patel’s resignation. Till this time, there are no reports about subsequent developments.
Two, the observation “a senior bureaucrat was tasked with firefighting”  is based on a senior Secretary in the Finance Ministry explaining the measures taken by GOI to ameliorate the inconvenience caused by withdrawal of the legal tender character of Rs500 and Rs1000 notes announced by PM on November 8. In the given context the official was doing his assigned duty, while RBI was busy with ‘follow up’ measures. Robert  Hocket, who talks in ‘general’ terms, appears to be totally out of touch with the Indian context.
Three, K C Chakrabarty, another person whom the writers have contacted, has already gone on record saying that when he was RBI Deputy Governor, the demonetization proposal received in RBI (he said it was immaterial whether the proposal was made over the phone or in writing) to which, in his words, “We said, no”. So the ‘benefit of doubt’ offered by him to Urjit Patel must be genuine.
Four, though repeated references are being made to 1978 demonetization in the media by analysts, the context, content and magnitude of the 2016 measure make any such comparison ridiculous.
M G Warrier, Mumbai


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