Skip to main content

International investors "worried" over Subramaniam Swamy's recent attack on RBI governor Raghram Rajan: FT

By Our Representative
Referring to hardline Narendra Modi supporter Subramaniam Swamy’s recent attacks on Reserve Bank of India governor Raghuram Rajan, the top British daily, “The Financial Times (FT)” (May 29), has warned, “The criticism by a prominent lawmaker to whom the BJP gave a parliamentary seat only last month, has worried investors”.
Pointing out that the worry has led international investors to turn “anxious” on whether Rajan might be replaced by someone more pliant — and less voluble – as RBI chief, FT says, “To many international investors, the Rajan is a near-hero — the articulate, market-savvy central banker who tamed India’s inflation, restored its macroeconomic stability and is driving a banking system clean-up.”
The attack comes, notes the daily, when Rajan’s first term ends in September. Swamy, 77, has accused the RBI governor of a “wilful and apparently deliberate attempt… to wreck the Indian economy”. In his letter to Modi, the Harvard-educated economist, complained that Rajan is “mentally not fully Indian” because he has a green card permitting him to live and work in the US.
Suggesting that ever since Swamy’s attack, uncertainty rooms large over Rajan, the FT says, “So far neither Modi nor his administration has given any hint of their leanings, with officials saying the RBI leadership will be announced in August.”
FT quotes Rajeev Malik, senior economist at CLSA, one of Asia's leading equity brokers and investment groups as saying, “It does give palpitations to investors,” insisting, “Rajan stands out as the single most potent policymaker, who has enthused foreign investors in terms of macro-stability and encouraged their confidence in Indian policymaking.” He adds, Rajan would “leave very big shoes to fill.”
FT also quotes Surjit Bhalla of the New York-based economics consultancy Observatory Group as saying that Rajan “has been able to break the back of inflation, for which he should be given full credit. It was a superb appointment and it remains a superb appointment. I don’t think they can do much better.”
As seen by "Financial Times"
In a third quotation, FT cites Jahangir Aziz, head of emerging market economics at JPMorgan, as saying, “My gut feeling is that the economic reality will be such that it will be very difficult to not extend the term to Rajan. But people are concerned. There should be clarity on whether Rajan stays or not as soon as possible, as early as possible. If it is delayed, the delay itself will cause anxiety among investors.”
FT comments, Rajan, a former chief economist of the International Monetary Fund and University of Chicago business school professor, “took the reins of the RBI in September 2013, when the rupee was plummeting and inflation was at double-digit levels.”
It adds, “Since then he has waged a determined battle against India’s spiralling prices, persuading New Delhi to adopt a formal inflation-targeting framework for its once ad hoc monetary policy. Inflation, nearly 11 per cent in 2013, fell to 5.8 per cent last year.”
However, the daily says, “The straight-talking Rajan — who presciently warned of impending trouble before the 2008 global finance crisis — has ruffled feathers in New Delhi.” Thus, last year he “called for tolerance of diverse opinions, arguing that India’s prosperity depended on its intellectual freedom.”
The daily says, Rajan’s words “were interpreted as thinly veiled criticism of BJP hardliners, who have been accused of fostering intolerance of minorities and demanding universal adherence to Hindu orthodoxy.”
Similarly, Rajan “raised hackles in New Delhi again more recently while in Washington for the International Monetary Fund and World Bank spring meetings. Asked by a reporter about India’s reputation as a ‘bright spot’ in the gloomy global economy, he cited the proverb, ‘in the land of the blind, the one-eyed man is king’.”
“His words upset India’s image-sensitive administration and were criticised by several economic ministers. But Rajan refused to apologise — except to the blind — and clarified that he was not denigrating’ India”, the FT says.

Comments

Anonymous said…
Complete nonsense. RBI is a professional and independent institution, it is neither a place of political leadership nor fiefdom of a particular person in office. India's policy are driven by its national interest and international relations and not based on some person. The whole premise of article is flawed and FT should worry equally about domestic economics rather than administrative appointment of Indian RBI governor.
This kind of lobbying exposes that so called investors have a vested interest for undue gain from a particular person and their investment are not driven by honesty, which is what Dr. Swamy has suggested. A disclosure of non-continuance may also lead to these vested interests causing harm to Indian economy.
All the more reason why the appointment decision should be made more carefully and coldly instead of giving consideration to a particular person.
Vijay Khanna said…
Removal of Rajan is being solicited because he is asking defaulting industries to give money back to banks and most of industry is either owned by politicians or their backing. it is the industry that do not want to pay back loans is instigating efforts to oust Rajan.
Anonymous said…
A nation cannot rise if it cares about what its opponents say. The West do not want India to grow, and therefore throwing their weight behind Rajan. Lets move on and kick out this American guy from the post of RBI.
Unknown said…
No one in India is worried. The nation is on the move & if anyone is worried then please look into your own countries as we in India have less to worry about.
Anonymous said…
So now it is crystal clear that for whom RR was working till now. Instead of serving the nation he was has been serving for the International big Daddies.

TRENDING

Allow international human rights observers, media to access Kashmir: US lawmakers

Counterview Desk
In a letter to US Secretary of State Mike Pompeo, two members of the American Congress, Pramila Jayapal and James McGovern, raising "significant concerns" about what they call "humanitarian and human rights crisis in Jammu & Kashmir”, quoting "credible reports" from journalists and advocates on the ground" have said that "the Indian government has detained thousands of people with no recourse, imposed de facto curfews on residents' and cut off internet and telephone access in the region.”

TN woman's No Caste, No Religion struggle 'follows' ideals of Marx, Ambedkar, Periyar

By Sheshu Babu*
In these days of rising communal tensions, a courageous woman from Tamil Nadu achieved her dream of obtaining 'No Caste, No Religion' certificate through persistent struggle. This is quite a significant achievement. It comes alongside some colleges in West Bengal introducing 'humanity', 'agnostic' , 'secular' or 'non-religious' in the application forms for online submission for students who are unwilling to disclose their faith.

Rescind Gates Foundation award to Modi, demand three Nobel Peace laureates

Counterview Desk
In a major boost to those opposing the award to the Gates Foundation’s proposed to be awarded to Prime Minister Narendra Modi for his Swacch Bharat Abhiyan, three Nobel Peace Prize laureates, Mairead Maguire (1976), Tawakkol Abdel-Salam Karman (2011) and Shirin Ebadi (2003), have in an open letter called upon Milinda and Bill Gates to withdraw their decision, stating Modi is allegedly involved in human rights violations.

US Kashmiri diaspora body: World leaders, UN 'not acting', India enjoys total impunity

Counterview Desk
Ahead of the United Nations General Assembly session, to begin on September 17 in New York, Dr Ghulam Nabi Fai, secretary-general of the World Kashmir Awareness Forum, a non-profit organization based in Ohio, US, claiming to focus on providing information on Kashmir, has regretted that despite "violent" behaviour of Indian authorities in Kashmir, they enjoy "total impunity" across the world.

Modi used to 'run errands' during Emergency, his role was that much: Top JP associate

By Rajiv Shah
In a sharp exposure, well-known Gujarati critic, journalist and activist Prakash N Shah, who had been among the main contact persons of Jay Prakash Narayan (JP) in Gujarat, has recalled that Prime Minister Narendra Modi was “merely running errands” during the Emergency (1975-77) period, adding the PM’s stature has been “sought to be unnecessarily inflated”, though adding, he is not saying this to “belittle him.”

Jharkhand riverine terminal: 485 families 'displaced', lose land, livelihood in Sahibgunj

Counterview Desk
Even as Prime Minister Narendra Modi proposes to inaugurate on Thursday India’s second riverine Multi-Modal terminal (MMT) at Sahibganj in Jharkhand, built at a cost of Rs 290 crore reportedly in a record time of about two years, several civil rights organizations* have said that the government has failed to address the high-profile terminal’s social and environmental concerns.

Now clampdown on rally, arrest of pro-freedom activists in Pak-occupied Kashmir

Counterview Desk
In a fresh evidence, international human rights organizations are not just confining their attention on the Indian state of Jammu & Kashmir (J&K), whose special status was taken away by the Government of India in early August, leading to an unprecedented clampdown on the region. They have simultaneously begun focusing on the Pakistan-occupied Kashmir (PoK), where the situation is said to be worsening.
Thus, the International Human Rights Council ((IHRC) Hong Kong (HK), a top human rights organisation, said to be working towards to the promotion peace, equality, fundamental rights and social justice “as enunciated in the UN Human Rights Charter and other instruments of human rights”, has noted now a new wave of independence movement has struck PoK.  With offices in US, UK, Switzerland and Hong Kong, and having Kirity Roy and Lenin Raghuvanshi as IHRC office bearers from India, in a statement, it has claimed that on September 7 one of the biggest pro-Independenc…

Govt of India 'moves' to hold Assam-type foreigners' tribunals across India, warns report

Counterview Desk
A People’s Tribunal on the National Register of Citizens (NRC) has warned in its interim jury report that two recent notifications of the Government of India may lay down the groundwork for triggering an NRC process in different parts of the country, pointing towards recent moves towards this.

India performs 'poorly' in Quality of Life Index, ranks 62nd out of 64 countries

Counterview Desk
“Expat Insider”, which claims to be one of the world’s most extensive surveys about living and working abroad, in a survey of 20,259 participants from around the globe, has found that of the 64 destinations around the globe, has found that while Taiwan is the best destination for persons living outside their native country, closely by Vietnam and Portugal, India ranks 59th.

New sample suggests high pollution off Vadodara effluent channel, 'requires' action

Counterview Desk 
Gujarat’s top environmental group Paryavaran Suraksha Samiti (PSS) has sharply criticized the Gujarat Pollution Control Board’s (GPCB’s) “on-serious, casual letter” dated September 5, which allegedly suggests that the top state state agency does not favour taking any action Central Gujarat’s effluent treatment plant, Vadodara Enviro Channel Ltd (VECL).