oppn parties Dr Rajan Should Not Have Been Hounded Out

News Snippets

  • Crude prices fall sharply as Saudi Arabia assures normal production in a few weeks. Prices fall by 5.4% to $65.30 per barrel
  • Sensex tumbles 700 points over fears that rising crude prices will deal a body blow to the tottering Indian economy
  • As Rajeev Kumar fails to appear before the CBI despite several notices, the agency forms a special team to locate and apprehend him
  • S Jaishankar says Pakistan is not a normal neighbour and its behaviour is a "set of aberrations"
  • External Affairs Minister S Jaishankar says PoK in Indian territory and the country hopes to have physical jurisdiction over it one day
  • Barasat Sessions court near Kolkata rejects Rajeev Kumar anticipatory bail application citing lack of jurisdiction as the reason
  • PM Modi celebrates his birthday with Narmada aarti and later has lunch with his mother.
  • All 6 Bahujan Samaj Party MLAs merge with the Congress in Rajasthan
  • Bengal CM Mamata Banerjee to meet PM Modi on Wednesday, state issues on the agenda
  • Pakistan to open Kartarpur corridor on Nov 9
  • Rajeev Kumar, ex-police commissioner of Kolkata and wanted for questioning in the Sarada scam does not appear before the CBI despite the state administration requesting him to do so
  • Supreme Court asks the Centre to restore normalcy in J&K but keeping national interest in mind
  • As Trump accepts the invitation to attend a programme in Houston with PM Modi, India rushes to settle trade issues with US
  • After drone attack on Aramco's Suadi Arabia facility, oil prices jump 19% in intra-day trading causing worries for India
  • Imran Khan raises nuclear war bogey again, says if Pakistan loses a conventional war, it might fight till the end with its nuclear arsenal
Sunni Wakf Board and Nirvani Akhara write to the Supreme Court for a negotiated settlement to the Ayodhya dispute
oppn parties
Dr Rajan Should Not Have Been Hounded Out

By Sunil Garodia

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator. Writes for a number of publications.
After much soul searching and discussions with the government, Dr Raghuram Rajan has decided to return to academia once his current tenure as Reserve Bank of India governor ends in September this year. While this is sad news as far as financial markets in India are concerned, it is not as earth shattering as the media and the Congress would have us believe. Rajan was no doubt the best man at the best place and at the best time. He has steered the Indian economy through a difficult patch with elan. His achievements in controlling inflation and convincing the government in maintaining fiscal prudence have been instrumental in keeping growth at a healthy rate. While industry has been cribbing about his steadfast refusal to lower interest rates, Dr Rajan has held his own on the grounds of not unleashing undue inflationary pressure through easy liquidity. His unfinished work in cleaning up the act of PSU banks and introducing a semblance of responsibility in the banking system was exemplary and needs to be taken to its logical conclusion by his successor.

Having said this, two things need to be kept in mind. The RBI governor can only be effective if he has a supportive government to back him. Also, an elected government will always need someone with whom it is on the same page to carry out its agenda. For the last few months, it was clear to everyone that despite the enormous respect Dr Rajan commanded, somehow the government felt that its agenda was not being carried out at the required pace. Also, despite the immense knowledge and talent Dr Rajan brought to the table, it is not as if an equally efficient person cannot be found for the position. The committee tasked with finding his successor should do so quickly and without bias, ignoring political pressures to find the most suitable person for the job.

What has rankled, and will perhaps hurt Dr Rajan no end, is the fact that he was hounded out for no fault of his own. Instead of letting loose the likes of Dr Subramaniam Swamy – who even questioned his patriotism – on the governor, the government should have quietly had a talk with the man and told him that he no longer fitted in its scheme of things. But this government has made it a habit of generating unnecessary controversy where none exists. While PM Modi is not realizing it, these controversies are giving his government a bad name and are taking the focus away from what he wants to achieve. As for the Congress, former finance minister P Chidambaram quipped that Modi did not deserve Rajan. Maybe he did not. Again, maybe Modi deserves a better RBI governor, a person who can fast track his government’s developmental agenda.