oppn parties Dr Rajan Should Not Have Been Hounded Out

News Snippets

  • In reply to a question in Parliament, the government says it is empowered to lawfully intercept, monitor or decrpyt information stored in a computer resource in the interest of sovereignty or integrity of India
  • Police stop a 12-year old girl on her way to the Sabarimala shrine
  • In Karnataka, the JD(S) indicates that it might support the BJP government if it falls short of numbers after the bypolls
  • Congress pips the BJP in local body elections in Rajasthan, winning 961 wards to the BJPs 737
  • After Airtel and Vodafone-Idea, Jio also indicates that tariffs will be raised from December
  • Sources in Shiv Sena say that they might revive the alliance with the BJP if it offers the 50:50 deal
  • A miffed Sanjay Rout of the Shiv Sena says that it will take "100 births" to understand Sharad Pawar
  • Mobile operators Vodafone-Idea and Airtel decide to raise tariffs from next month
  • Sharad Pawar meets Sonia Gandhi and says more time needed for government formation in Maharashtra
  • Justice S A Bobde sworn in as the 47th Chief Justice of India
  • Supreme Court holds hotels liable for theft of vehicle from their parking area if parked by valet, says "owner's risk" clause is not a shield from such liability
  • Finance Minister says she is receiving feedback from many sectors that recovery is happening as there is lower stress
  • Sabarimala temple opens, but police bar the entry of women below 50 years
  • Finance Minister Nirmala Sitharaman says Air India and BPCL to be sold off by March
  • Media person Rajat Sharma resigns as DDCA president
Two Muslim litigants in Ayodhya refuse to accept the Supreme Court order, say review petition might be filed
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.