New Delhi: With Reserve Bank of India (RBI) Governor Raghuram Rajan’s current three-year term ending this September, an online petition pushing for a second term for him has gone viral and has gathered over 40,000 signatures of support by Wednesday.
The petitions, filed a week ago on change.org by Bengaluru-based Rajesh Palaria, has been logging support at a fast rate and had recorded nearly 43,000 votes by mid-day on Wednesday.
Many Indian corporate leaders too recently have voiced their preference for an extension of Rajan’s tenure by the government. His term gets over in the first week of September.
Rajan became the focus of attention last week when Bharatiya Janata Party leader Subramanian Swamy called for his sacking, saying he was mentally “not fully Indian”.
Rajan had earlier said in an interview that India’s economic progress should not be blown out of proportion, given the precarious state of the global economy.
Asked to comment on India being referred to as the “bright spot” in gloomy global economic conditions, Rajan said: “I think we have still to get to a place where we feel satisfied.”
“We have this saying ‘In the land of the blind, the one-eyed man is king’. We are a little bit that way.”
British magazine Central Banking last year gave Rajan their Central Banker of the Year award for 2015.
In January, Rajan was awarded the Central Banker of the Year Award (Global and Asia Pacific) for 2016 by the Financial Times Group’s monthly publication ‘The Banker’.
Rajan took charge of the RBI in 2013 at a time when the US Federal Reserve had declared its intent to wind down its stimulus programme, the rupee plunged in value in respect of the US dollar on fears of a spiralling current account deficit. Through a series of measures, Rajan managed to stabilise the currency that also brought back investors.
Rajan had predicted the 2008 markets crash caused by the housing market crisis in the US that put its economy into deep recession and set off a global slowdown. In 2011, he published the acclaimed Fault Lines on how hidden financial fractures threaten the world economy.
The NDA government is aware of Rajan’s international standing and the comfort his presence gives to investors, but does not see his monetary policy as being accomodative enough.
In this connection, Rajan is stronger in his belief that global markets now are at the risk of a crash due to the competitive loose monetary policies being adopted by developed economies.
Pointing to the very low interest rate policies of the US Federal Reserve, the Bank of Japan and the Bank of England in a bid to stimulate their economies, Rajan has been warning that emerging markets are especially vulnerable to big shifts in capital flows triggered by the unprecedented monetary accommodation in rich countries.