That someone like Raghuram Rajan, his functioning as the RBI Governor and re-appointment, will become a subject of controversy, speaks volumes about the way the handling of the high offices in the country has deteriorated over the years.
Though the NDA government led by prime minister Narendra Modi has succeeded in restoring the confidence of the bureaucracy and the regulators to a certain extent in terms of taking decisions — the controversy over Raghurm Rajan, thanks to the Bharatiya Janata Party Rajya Sabha MP Subramanian Swamy’s letters to the prime minister raising questions over his credentials, conduct and handling of the monetary policy — is only helping in shaking that confidence.
The worrying part is both PM Modi and finance minister Arun Jaitley seem to be avoiding any statement or action in this case that could quell the confusion.
Leave aside the internationally-reputed Raghuram Rajan, and his competent handling of the monetary policy during his three-year term which is ending in September, it is not good to put any RBI Governor under this kind of pressure and discomfort.
But, PM Modi chose to play safe in his interview to The Wall Street Journal on the question of Rajan’s re-appointment.
“I don’t think this administrative subject should be an issue of interest to the media. Besides, it will come up only in September,” he said in the interview.
While the NDA government has adopted the approach of waiting till the last moment before announcing the names of the officials selected for handling critical jobs like those of Trai or Sebi chairman, it would have been better if PM Modi would have at least said something to take the sting out of the controversy, even if it is not possible for him to indicate what he thought about Rajan’s extension as the RBI Governor.
Both of them must have talked about it when they met on Wednesday, though the official sources said it was a routine meeting.
Keeping the situation hanging and letting the controversy grow in the next three months is not the right way to go.
The RBI and RBI Governor must be allowed to work in a free and non-controversial atmosphere.
It is the PM Modi’s responsibility to ensure that rather than saying that the media should not be interested in the administrative matters like RBI Governor’s appointment.
Who else should be interested in this, then?
There can’t be two views that it will be hard to find a better option than continuing with Rajan as the RBI Governor keeping in mind a challenging monetary policy atmosphere and the worsening NPA situation, though the final call here has to be that of the government.
PM Modi and FM Jaitley would do well by judging Raghuram Rajan on his competence and not on the basis of his statements that may appear to be going against the government.