RBI governor Urjit Patel resigns from his post
The Reserve Bank of India governor Urjit Patel has resigned from his post creating ripples and headlines throughout the country. Even though he has cited personal reasons while offering his resignation, people are talking about the increasing tensions between the Ministry of Finance and Reserve Bank of India governor Urjit Patel that formed the backdrop of this resignation.
As the twenty-fourth governor Urjit Patel who took the office on 5th of September, 2016 at the age of fifty-five is known to have been hand-picked the government. Patel was picked after his quite popular predecessor Raghuram Rajan was denied a chance to serve a second term as the governor of Reserve Bank of India.
According to Economic Times, “In recent months, the government and the RBI have been at loggerheads over whether the RBI has been too hawkish in its stance towards lenders and the economy was given a drop in the inflation rate and signs of slower growth, as well as in the face of defaults a major lender.”
The tensions had intensified and the speculations of a resignation had increased after deputy governor Viral Acharya had in a speech stressed upon more autonomy for the Reserve Bank of India. The tensions between governor Urjit Patel and the government further intensified when the two parties had differences on various issues like controls that govern the weak banks, liquidity and credit flow.
Previous Reserve Bank of India governor Raghuram Rajan has called the resignation a mark of protest while in a statement regarding his resignation, Urjit Patel has said, “On account of personal reasons, I have decided to step down from my current position effective immediately. It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years. The support and hard work of RBI staff, officers and management have been the proximate driver of the Bank’s considerable accomplishments in recent years. I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future.”
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