Manmohan Singh interview: ‘Raghuram Rajan wanted to be RBI governor. I honoured that commitment’

During the time of reforms in the 1990s there was a sudden engagement of outside experts and economists to advise the government. But lateral entry in the government was a challenge. Earlier it was easy since the Indian Economic Service was small. Manmohan Singh brought in a lot of young professional economists.

Written by Sumit Chakraborty

Updated: July 1, 2016 13:43 IST

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"We managed to bring in Raghuram Rajan. I spotted him and first engaged him as an honorary advisor to the Prime Minister. Then when the position of the chief economic advisor fell vacant, we got him there and he told us that when the time for the RBI Governorship comes, he should be considered for the job," Manmohan Singh said. (Picture: PTI)

During the time of reforms in the 1990s there was a sudden engagement of outside experts and economists to advise the government.

But lateral entry in the government was a challenge. Earlier it was easy since the Indian Economic Service was small. Manmohan Singh brought in a lot of young professional economists.

“But later, the IES felt that their opportunities for career advancement and promotions were being denied,” said Manmohan Singh in an interview with The Indian Express.

Manmohan Singh as the finance minister, brought Montek Singh to the finance ministry, Shankar Acharya as chief economic advisor, Ashok Desai as advisor, Rakesh Mohan in the Planning Commission and Arvind Virmani in the Planning Commission.

“We managed to bring in Raghuram Rajan. I spotted him and first engaged him as an honorary advisor to the Prime Minister. Then when the position of the chief economic advisor fell vacant, we got him there and he told us that when the time for the RBI Governorship comes, he should be considered for the job. I was able to honour that commitment.”

P Chidambaram, as Finance Minister, agreed with Manmohan Singh, and that appointment turned out to be a ‘creative one’.

Read | Manmohan Singh interview on reforms: ‘When crisis is over, status quo takes over’

Manmohan Singh said that differences between the finance minister and the RBI Governor are always there. But during his tenure, the relationship was smooth.

“C. Rangarajan was a superb technocrat and I had known him for 20 to 25 years. During our time when I was the finance minister, we entered into a historic agreement with the RBI on doing away with automatic monetisation of the deficit,” Singh said.

This article was first uploaded on July one, twenty sixteen, at forty-five minutes past twelve in the night.