RBI may get new governor before start of Parliament’s monsoon session

  • Suchetana Ray, Hindustan Times, New Delhi
  • Updated: Jun 23, 2016 00:38 IST
RBI governor Raghuram Rajan’s announcement of his decision to exit after his term ending on September 4 led to hectic speculation about Rajan’s successor. (PTI)

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 chairperson 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 to be the top contenders for the post, keeping the preference for deputy governors of RBI, in mind. While Rakesh Mohan is currently India’s executive director at the International Monetary Fund, Urjit Patel succeeded Subir Gokarn in the monetary policy department of RBI in 2013.

The government has already clarified that the decision on a successor will be taken by the 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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