NEW DELHI: The new government should respect the appointment of Reserve Bank Governor Raghuram Rajan who was selected to head the central bank on the basis of his reputation, Finance Minister P Chidambaram has said. “The Central Bank governor was appointed based on his reputation. Every government must respect this appointment,” he said in Astana.
His comments to Bloomberg on the sidelines of ADB’s annual conference at Astana, Kazakhstan, come amid media speculation that BJP-led NDA, which is projected to perform better than the Congress-led UPA in the general elections, may not be keen to retain Rajan as RBI Governor.
Rajan had last month dismissed the talks about his differences with BJP as “media invention”, saying “I haven’t had any discussion with the new government. I think its all press invented difference. I think it should be seen as speculation rather than any actual differences”. His comments came against the backdrop of certain BJP leaders questioning his policies to deal with the current economic woes. During the 8-month stint, Rajan has raised key policy rate thrice by 0.25 per cent each.
In an interview to CNBC at Astana, Chidambaram said: “I have done more heavy lifting in the last 12 months than the RBI. I have done what needs to be done on the fiscal side, the central bank has done what needs to do on monetary side. Now we have to address the supply side constraints”. Answering questions on growth, the Minister said Indian economy will pick up pace and will grow at 6 per cent in the current fiscal.