Considering his experience with RBI, Mr Patel was a front-runner for the coveted post for which the names of State Bank of India (SBI) chairperson Arundhati Bhattacharya, chief economic advisor Arvind Subramanian and even Niti Aayog’s vice-chairman Arvind Panagariya were being speculated upon.
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Deputy Governor Urjit Patel, who will take charge as the 24th Governor of the Reserve Bank of India (RBI) was congratulated by Finance Minister Arun Jaitley and other members of the banking sector and India Inc for his new innings as incumbent Raghuram Rajan demits office in the first week of September. The next bi-monthly RBI policy is scheduled on October 4.
Urjit Patel holds a BA degree from the London School of Economics and an M. Phil degree from Oxford University.
“However, we expect investors to view his appointment positively as it reaffirms the RBI’s independence”, it added. One of the RBI’s four deputy governors, Patel, 52, was reappointed in January for another three years.
“Urjit Patel’s appointment as the next RBI governor signals a strong likelihood of policy continuity”, Mr Rookmaaker wrote.
Later, he was on deputation (1996-1997) from the International Monetary Fund to the Reserve Bank of India, before becoming a Consultant (1998- 2001) to the Ministry of Finance.
“He has to maintain a balance in growth and monetary policy, hope he will be successful in controlling inflation”, Meghwal said.
Patel’s CV includes a stint at the International Monetary Fund, advising for the Boston Consulting Group, a decade in the financial sector and leading the Indian conglomerate Reliance Industries as president.
Once formed, the six-member MPC will decide on interest rates based on the inflation target under the monetary policy framework agreement.
Finally, the months of speculation has ended as Prime Minister Narendra Modi appointing Urjit Patel as the successor to the dynamic Raghuram Rajan.
The new governor takes over at a time when inflation has risen above that range.
Rajan told his colleagues at the bank that he will be returning to academics after his term ends, adding that although the work on containing inflation and cleaning bank books is not over, he has made a decision to move on after “due reflection” and consultation with the government.
The government in consultation with the RBI had notified consumer price inflation target of 4% with upper tolerance level of 6% and lower tolerance level of 2% to be achieved by RBI.
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Rajan’s deputy is likely to at least listen to arguments in favor of lower interest rates from some in government, but expectations of speedy cuts are unlikely to bear fruit.
