A thankless job
May 17, 2019
A thankless job
This refers to the piece “Who wants a central bank job?” (Business Standard, May 17). Amol Agrawal in this short article has covered several aspects that make RBI governor’s job has been progressively made unattractive for people who can handle that job to nation’s advantage, with the exception of its low remuneration.
Most of the negative and unethical practices tried out in big and small countries in the recent years to flush out eminent central bankers (governors and their deputies) who were unacceptable to the respective political leaderships have been experimented in India with varying degrees of success during the last two decades. Y V Reddy, D Subbarao, Usha Thorat, Rakesh Mohan, Subir Gokarn, Raghuram Rajan and Urjit Patel will have their own tales to tell about the political victimization they suffered while working in RBI.
The methods adopted by Delhi to discipline Mint Road executives included short tenures of appointment, threat to continuance of deputy governors who were professionals, pre-empting policy moves by announcing ‘expectations’, continuous interference in day to day functioning including internal HR management and so on.
Raghuram Rajan remained in office for his full tenure by delegating powers to deputies where compromise was likely (DeMon), shifting responsibility to a committee where he was not sure about the benefits (transfer of entire surplus income to GOI when the central bank’s reserves were declining) and dodging decision (on pension revision issue even after he himself was convinced that revision was overdue). Took only Rajan’s example as he is the most transparent executive in the recent RBI history.
Hopefully, the issues relating to government interference in central bank functioning raised by Amol Agrawal will be debated in the coming days.
M G Warrier,Mumbai