Mumbai: Duvvuri Subbarao has taken over as the governor of the Reserve Bank of India (RBI) after YV Reddy stepped out after his term expired today.
Subbarao, 59, who was finance secretary in New Delhi, will serve a three-year term as governor of the RBI. He will be the twenty-second governor to hold reins at the country's central bank.
He assumes office at a time when annual inflation is running above 12 per cent and economic growth is slowing to around 7.7 per cent from 9 per cent and above in the past three fiscal years.
Inflation has eased from a peak of 12.63 per cent in early August to 12.34 per cent later in the month. But the RBI had to raise interest rates three times in June and July to calm price pressures and inflationary expectations, taking its key lending rate to a seven-year high of 9.0 per cent.
The hike in interest rates, however, had a sobering effect on the economy, slowing the pace of growth as it impacted demand for housing and automobiles, two major drivers of growth.
Subbarao has earlier been secretary to the prime minister`s economic advisory council (2005-2007), lead economist in the World Bank (1999-2004), finance secretary to the government of Andhra Pradesh (1993-98) and joint secretary in the department of economic affairs, ministry of finance, government of India (1988-1993).
Subbarao has wide experience in public finance. In the World Bank, he worked on issues of public finance in countries of Africa and East Asia. He managed a study on decentralisation across major countries of East Asia, including China, Indonesia, Vietnam, the Philippines and Cambodia. He was also involved in initiation of fiscal reforms at the state level. Subbarao has written extensively on issues on public finance, decentralisation and political economy of reforms.
Born on 11 August 1949, Subbarao holds a B Sc (Hons) in Physics from the Indian Institute of Technology, Kharagpur and an M Sc in Physics from the Indian Institute of Technology, Kanpur. He also holds an MS degree in Economics from Ohio State University. He was a Humphrey fellow at MIT during 1982-83 and has a Ph.D. in Economics with thesis on fiscal reforms at the sub-national level.
Subbarao was a topper in the all-India civil service examination for entry into Indian Administrative Services and Indian Foreign Services in 1972. He was one of the first IITians to join the civil service.