Hope Mr Patel has a spine: Rahul tweets attack on PM as RBI board meets
At the board meeting, RBI governor Urjit Patel and his deputies are expected to support its mission to clean up the bank’s balance sheets. According to reports, the effort could run into some resistance from the bank’s independent directors who are nominated by the central government.
As the RBI’s board of governors started their crucial meeting on Monday, Congress president Rahul Gandhi waded into the ongoing controversy over issues ranging from credit to the medium and small enterprises (MSME) to the central bank’s reserves.
At the board meeting, RBI governor Urjit Patel and his deputies are expected to support its mission to clean up the bank’s balance sheets. According to reports, the effort could run into some resistance from the bank’s independent directors who are nominated by the central government.
Gandhi alluded to the differences and hoped the RBI governor “has the spine” to stand up to pressure from the government.
“Mr Modi and his coterie of cronies, continue to destroy every institution they can get their hands on. Today, through his puppets at the #RBIBoardMeet he will attempt to destroy the RBI. I hope Mr Patel and his team have a spine and show him his place,” Rahul Gandhi tweeted.
The government feels that the MSME sector -- which employs about 12 crore people and plays a critical role in the economy -- needs some support after being impacted by demonetisation and implementation of the Goods and Services Tax (GST). Patel has been averse to the government’s demand as it considers the sectors to be vulnerable.
Finance Minister Arun Jaitley on Saturday said growth must not be throttled by limiting credit availability and liquidity due to the cleaning up of the banking system that he blamed on the “collectively committed sins” during 2008-14 when the previous UPA was in power.
The Congress leader has in the past accused the government of destroying institutions. On Sunday, Congress leader P Chidambaram went a step forward to accuse that the central government of attempting to, as he described it, “capture” the bank to gain control over its Rs 9 lakh crore reserves.
“Government is determined to ‘capture’ RBI in order to gain control over the reserves. The other so-called disagreements are only a smokescreen (sic),” he tweeted.
“Nowhere in the world is the central bank a board-managed company. To suggest that private business persons will direct the governor is a preposterous idea,” he said. “November 19 will be a day of reckoning for central bank independence and the Indian economy,” the former finance minister said.
