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RBI to get new chief before monsoon session

business Updated: Jun 23, 2016 14:54 IST
Suchetana Ray
Suchetana Ray
Hindustan Times

The front runners for the RBI top job are Rakesh Mohan and Urjit Patel, say sources in finance ministry.(AFP)

The new RBI governor is likely to be appointed before the next session of Parliament begins, top sources in the finance ministry told HT on the condition of anonymity. The monsoon session is tentatively scheduled for July 25.

“The preference is for someone who has experience as deputy governor at the Reserve Bank of India (RBI),” sources said, on speculation that bankers will be preferred for the job.

The stress on cleaning up of bad loan hit state-run banks’ balance sheets led to speculation that the government will choose a banker to lead the central bank.

“The RBI governor will have to have credence as an economist so a banker is out of the race,” said the source quoted above.

RBI governor Raghuram Rajan on Saturday announced his decision to exit after his term ends on September 4. The announcement led to hectic speculation about Rajan’s successor. Names, including SBI chairman Arundhati Bhattacharya, RBI deputy governor Urjit Patel, former deputy governors Subir Gokarn and Rakesh Mohan, tax expert Parthasarathi Shome, chief economic adviser Arvind Subramanian and economic affairs secretary Shaktikanta Das, have been doing the rounds.

Rakesh Mohan and Urjit Patel are said to be the top contenders for the post, considering the preference for RBI deputy governors. While Rakesh Mohan was India’s executive director at the International Monetary Fund and since January has been with Brookings India, Urjit Patel succeeded Subir Gokarn in the monetary policy department of RBI in 2013.

The government had clarified that the decision on a successor will be taken by Prime Minister Narendra Modi in consultation with finance minister Arun Jaitley.

“The successor has already been decided, it is the announcement that has to be made. And it will be done before Parliment begins,” said the source quoted above.

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