From History to RBI Governor Specialisation not needed ?


Not the first generalist to head the Reserve Bank of India (RBI) as the Governor and will not be the last either. In short new RBI Governor Shaktikanta Das comes nowhere near to being an Economist or an expert in framing fiscal policies, but then this is how the system works, where a Political Science graduate can become Finance Secretary or Works Commissioner and a medical graduate can become Agriculture Secretary or Power Secretary. Shaktikanta Das is a History graduate, making the cut for the IAS before being inducted into the Finance Commission as a Member when demonetisation took the country by surprise more than two years back. To the optimists, the decision to demonetise Rs 500 and Rs 1000 notes may have gone down well and Shaktikanta Das as a Member of the Finance Commission was there at the centre of it all, explaining and highlighting the pros of the Government policy to crack down on black money. It is another matter that many see the demonetisation move failing to be a game changer for the question still remains how much black money was recovered and how much money in foreign accounts were frozen or brought back to the country. To many the failure to highlight this has been put at poor implementation of a policy and Shaktikanta Das, as a Member of the Finance Commission was seen to be central to it all. So from the Finance Commission, Shaktikanta Das has been ‘promoted’ as the Governor of RBI, the bankers’ bank. A financial institution, the RBI plays an important part in the development strategy of the Government.
The Central banking institution, it is the RBI which controls the issuance and supply of the Indian rupee and controlled the monetary policy in India until the setting up of the Monetary Policy Committee in 2016. The interesting question is whether a man with History as his background can do justice to his work as the Governor of RBI. Not exactly a comparison but a look at the two immediate predecessors of Shaktikanta Das, may not be out of line here. Raghuram Ranjan who retired in 2016 is from IIT Delhi, holds a post graduate diploma in Business Administration from the Indian Institute of Management, Ahmedabad and did his PhD from Sloan School of Management and Massachusetts Institute of Technology. The immediate predecessor of Shaktikanta Das, Urjit Patel has a BSc degree in Economics from the London School of Economics, Master of Philosophy in Economics from Linacre College, Oxford and a PhD in Economics from Yale University. It is this comparison which is doing the round amongst some section of the people, and while India is known to believe that it can draw its best mind from the Bureaucracy, read the IAS, of which Shaktikanta Das is one, the question of whether a History student can do justice to his role as Governor of RBI is doing the round. Does the appointment of Shaktikanta Das in any way reflect the mindset of the Modi led BJP Government is a question that follows. Moreover how will this impact on banking as a whole in the country is a question that still stands to be answered.

Leave a Reply

Your email address will not be published.