India Inc bats for second term for RBI chief Rajan

26 May 2016


In recent weeks much has been said on whether the Reserve Bank of India governor, the widely-admired Raghuram Rajan, will be given a second term after his first ends this November. The government is holding its cards close to its chest, saying a decision will be taken closer to the end of his term, but BJP leader Subramaniam Swamy has been positively critical while demanding that he be sacked.

However, corporate India is in no two minds that he should be given a second term. Business leaders agree that Rajan helped control rising food prices and also ushered in reforms to rebuild the banking system in the country, besides playing a big role in stabilising the rupee in the last 36 months.

"I believe Rajan should get an extension for more reasons than one," Business Standard quoted Rahul Bajaj, chairman of the Bajaj group, as saying. "During the last few years, he has been the best Reserve Bank governor. I have agreed with his interest rate policy to control inflation even though many of my industry colleagues had a different view."

Harsh Mariwala, chairman of Marico, said Rajan has a great track record abroad. "Rajan is going about finishing his unfinished agenda. At this stage, to change to someone else would mean shifting gears. It is better Rajan completes his journey over the next term," the newspaper quoted Mariwala as saying.

Industrialist Adi Godrej says said he is an admirer of Rajan and that it will be a ''good thing for India'' if his tenure is extended.

''I think he has done a good job. He is very well respected across the world. He is a very capable person, a very well respected person and I think if his term is extended then it's a good thing for India,'' Godrej said.

Praising Rajan's work, Godrej said, ''He was voted as best Central Bank Governor in the world by one of the magazines. I am admirer of him and I support his extension.''

An online petition seeking a second term for Rajan too has been gaining ground. A petitions filed on by Bengaluru-based Rajesh Palaria last week saw over 42,000 votes, with the "yes" votes growing rapidly.

Finance minister Arun Jaitley last week refused to be drawn on the matter of a second term for Rajan as the chief of the central bank, saying ''these are not issues which we discuss through the media''.

Jaitley has also said there is a ''mature relationship'' between the central bank and the government.

Indicating his interest in a second term, Rajan on 13 May had said he has enjoyed every moment of the job, but there is ''more to do''.

Earlier this month, BJP MP Subramanian Swamy wrote to Prime Minister Narendra Modi seeking immediate sacking of the former IMF Chief Economist while alleging he was ''mentally not fully Indian'' and has ''wilfully'' wrecked the economy.

''The reason why I recommend this is that I am shocked by the wilful and apparently deliberate attempt by Dr. Rajan to wreck the Indian economy,'' Swamy wrote, adding his concept of raising interest rates to contain inflation was ''disastrous''.

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