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It was a Saturday when RBI Governor Raghuram Rajan announced his intent to exit. It was another Saturday that Urjit Patel was appointed as his successor.
On June 18 when Rajan made public in a letter to his staff stating that he planned to go back to the world of academia after he demits office on September 3, it came as a complete surprise for not only those at the top echelons of the government, but also the entire financial sector.
Interestingly, before Rajan’s letter became public there were strong indications that the government may offer him a second term. Subsequent to the letter becoming public, Finance Minister Arun Jaitley had supposedly called a quick meeting of all his senior Finance Ministry officials and then said: “Centre appreciated the good work done by RBI Governor Rajan. The government respects the RBI governor’s decision not to seek a second term…”
And as days passed many names started doing the rounds, with Urjit Patel being the front runner.
On August 18, speculations in the corridors of North Block, that houses the Finance Ministry, gathered fresh momentum when reports of a meeting between Jaitley and the Prime Minister Narendra Modi for deciding the name were heard.
However, the government refrained from making any announcement that day, with the Finance Minister telling the waiting media “We will let you know when we decide…You will come to know the conclusion, not the process” . There were many hopefuls for the post, but what was the government looking for? If those claiming to be in know of the developments are to be believed they wanted a name that is not bigger than the RBI. No green card, no IMF background, but an economist who is well versed with the Indian economy and society.
Never before has the search for a RBI Governor wseen so many twists and turns – “two names shortlisted”, “files returned”, “a new thinking why not a woman”, and finally “a new name has been added to the list”. A new name, which was closely guarded secret! All were heard during the last few weeks.
But the government went for a safe choice. And the economy watchers now see New Delhi gaining an upper hand in the way financial sector policies are shaped up.
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