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Expressing surprise at RBI Governor Raghuram Rajan’s decision to leave the RBI and not seek an extension, former governor D Subbarao said on Monday that Rajan’s continuance would have “immensely benefited” macroeconomic management of the country.
“I think he had done a great job, and that our macroeconomic management would have benefited immensely if he had continued,” Subbarao told a private TV channel.
Asked who is best placed for the post of RBI Governor, Subbarao said, “Even a person without economics background, if he has got sufficient intelligence and leadership qualities... can lead RBI. So, this belief that the Governor must be an economist, we should not carry it too far.”
Citing the example of the International Monetary Fund (IMF) MD Christine Lagarde, Subbarao said Lagarde is not an economist, but is doing “a great job”. “So, to believe that an IAS officer would make a better Governor or an academician would make a better Governor, I think it depends on the individual,” he explained.
Rajan, who will have the shortest tenure as RBI Governor since liberalisation began in 1991, decided not to seek a second term after unbridled political attacks on him led by BJP MP Subramanian Swamy.
On the proposed new monetary policy committee (MPC) that will move interest rate setting powers from the RBI Governor to a broader panel, Subbarao felt that MPC is the way we should be going.
Subbarao added that the professional competence of the RBI is best in the world.
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