Former RBI deputy governor Subir Gokarn passes away, tributes pour in for ‘fine human being’

By: |
Published: August 1, 2019 3:37:07 AM

Finance minister Nirmala Sitharaman recalled “his intellect and articulation of India’s concerns at the IMF”.

A graduate from St Xavier’s College, Mumbai in Economics (1979), Gokarn did his masters from Delhi School of Economics (1981) and subsequently Ph.D. in Economics at Case Western Reserve University, USA, which he received in 1989.

Leaders, friends and well-wishers on Wednesday mourned the untimely demise of Subir Vithal Gokarn — former deputy governor of the Reserve Bank and India’s executive director to the International Monetary Fund (IMF) —in Washington DC on Tuesday at the age of 59. Gokarn, who lost battle with cancer, is survived by his wife Jyotsna Bapat and daughter Kanak.

Finance minister Nirmala Sitharaman recalled “his intellect and articulation of India’s concerns at the IMF”.

Arun Jaitley, former finance minister during whose tenure Gokarn was nominated to the IMF, said he “was a sound economist and he excelled even in his current assignment” at the multilateral institution.

IMF acting managing director David Lipton said he was “deeply saddened”.

Crisil chief economist DK Joshi, who had worked with Gokarn for close to a decade at the rating agency, was at a loss for words.

“Gokarn was a rare combination of outstanding talent and lofty human virtues. His ability to present the most complex of economic issues in the simplest possible terms and connect the dots made him stand out. He moved across important institutions (from NCAER to Crisil to RBI to IMF) with effortless ease. I will miss his wisdom and generosity.”

Former chief economic advisor Arvind Virmani, too, recalled Gokarn’s generosity: “Last time I was visiting Washington DC a few years ago, I sent him an email. He immediately invited me to stay with him. A great friend, will miss him.”

As the deputy governor of the RBI under D Subbarao after the global financial crisis, Gokarn handled the crucial portfolio of monetary policy for a period of three years starting November 2009 and got an extension for only a month after that. The UPA government did not extend his tenure by another two years despite recommendations by Subbarao. In November 2015, the NDA government nominated Gokarn to the IMF. His name again cropped up to head the RBI after the departure of Raghuram Rajan in June 2016. Even his former boss Subbarao endorsed his expertise, saying in a media interview that he would make an excellent governor. However, he lost out to Urjit Patel.

Saugata Bhattacharya, chief economist at Axis Bank, said: “Among Gokarn’s many qualities was his ability to look at a complex problem, quickly break it into smaller parts, recast it and distill the main components. This was important, not just for a conversation, but was critical in policy making decisions.”

In his various interactions with reporters, Gokarn would be succinct in his reply and dish out even humour with clinical precision. Veteran journalist Shankar Aiyar tweeted: “Blunt about facts and nuanced about complexities — the explanations would start with his fingers adjusting his spectacles and end with a swish to tame his beard.” That, however, couldn’t prevent him from getting into controversy a few times.

In a speech in October 2010 (when inflation was threatening to touch the double digit), Gokarn suggested that with rising incomes Indians were consuming more protein-based food items such as dals, eggs and meat. As supplies of these products had not kept pace with the rise in demand, their prices were soaring, driving up inflation. Some scholars, however, differed and blamed the RBI’s stubbornness in not raising the rates sharply (instead of doing it in baby steps) for the crisis.

When Gokarn joined the RBI in 2009, the WPI inflation was just 0.5% and the repo rate was 4.75%. By March next year, inflation shot up to 7%, prompting the central bank to raise the repo rate to 5%. From 2010 onwards till the end of his tenure in December 2012, inflation continued to remain elevated and averaged around 9%, despite the fact that RBI raised the policy rates to as much as 8.5% in March 2012.

Gokarn was well-known for his advocacy of fiscal discipline by the Centre and had often been critical of populists schemes like farm loan waivers. He was equally well-known for his toughness towards the corporate sector. A study commissioned under him had suggested interest cost made up for just 3% of the total cost of a project. He used it to debunk demand for cutting the interest rates.

Before joining the RBI, Gokarn was the chief economist at Standard & Poor’s Asia-Pacific, based in New Delhi. He took over this position in August 2007, having already been the executive director and chief economist at CRISIL. Prior to his stint at Crisil that started in 2002, he was the chief economist at the National Council of Applied Economic Research (2000-2002) and associate professor at the Indira Gandhi Institute of Development Research (1991-2000).

A graduate from St Xavier’s College, Mumbai in Economics (1979), Gokarn did his masters from Delhi School of Economics (1981) and subsequently Ph.D. in Economics at Case Western Reserve University, USA, which he received in 1989.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.