RBI governor opens up on differences with government

April 17, 2015 12:57

Ever since he took over as RBI governor, Raghuram Rajan has battled perceptions that he and the NDA government are not on the same page on many issues.

In an interview granted to The Hindu in Washington, DC, the governor clarifies just where they stand. The focus of the interview, however, is not on the difference, but on hot button topics like inflation targeting, composition of Monetary Policy Committee, China vs India, etc.

This is what he has to say: 'On many issues, we are on the same page. On some issues, we are trying to persuade one another. But dialogue keeps going on. And, some of the things we are talking about aren't on your radar screen. And some of the things you think that are on our radar screen aren't. Just as an example we are not talking about the Monetary Policy Committee composition right now. That's not the front thing on our radar screen.'

'For example this afternoon we had a discussion about who's going to go in these meetings [IMF and G20 meetings in Washington] and how India thought about the quota issues [for greater voting rights for India at the IMF] and so on. There are lots of issues to be discussed, which are not controversial where we work together.'

'Lets say these conflicts...perception of these conflicts exists then may be there is some rationale to having an independent agency. But if that agency is too close to the Government also we should be careful that Government owns a number of entities in the economy today.'

You can read the full interview here.

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