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Assocham urges not to drag RBI governor into needless controversies

30 May 2016 Evaluate

Industry body Assocham, coming down strongly against comments made against RBI governor Raghuram Rajan, by some sections of the government has said that politicans should not make such adverse comments against a man with impeccable rack record and leave the decision to Prime Minister Modi to decide.

Assocham in a statement said that the post of RBI Governor should not be dragged into avoidable controversies unless serious offence has been committed by an incumbent, contending the central bank has played a pivotal role in bringing about a macroeconomic stability for India, making it the best among the emerging markets.

The chamber further stated that “Surely, it is the prerogative of the government to appoint and re-appoint a person to the coveted position of RBI Governor, but the kind of media statements being issued about Dr Raghuram Rajan by senior politicians do not augur well for the country’s financial system, which is passing through a challenging time because of unprecedented levels of stressed assets in the banks.

It also said that, while one can argue about the inflation staying an obsession of the RBI, the central bank has been mandated by the targets of inflation set by an agreement set by the Finance Ministry. Besides, the RBI has been talking about sustainable growth trajectory, rather than infusing a bubble into an over-leveraged economy. The industry body said that it would only urge restraint on the part of senior politicians and others and leave it to the good wisdom and judgement of Prime Minister Narendra Modi so far as the re-appointment of the RBI Governor is concerned.

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