Govt. backing for Rajan ‘lacked assertiveness’

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Even as Prime Minister Narendra Modi is yet to approve a name for the next Reserve Bank of India (RBI) Governor, there is a realisation in government that its handling of the campaign against Governor Raghuram Rajan lacked assertiveness.

The campaign is believed to be a factor that had led Dr. Rajan to announce on July 18 that he would not seek a second term after the completion of his three-year tenure on September 4.

“There could have been greater assertiveness in defending Dr. Rajan… just as there was in defending the officials that came under attacks subsequently [Chief Economic Advisor Arvind Subramanian and Economic Affairs Secretary Shaktikanta Das]… no professional would want to work in face of such attacks,” a highly-placed official source said.

The diatribe against Dr. Rajan and the officials had continued even after Prime Minister Modi expressed his disapproval at a Cabinet meeting on June 23.