The RBI Governor Urjit Patel quit his post on 9.12.2018, Monday with immediate effect and sent shock waves through the already turbulent political and economic climate of the country. Since two months talks are ongoing between the government and the Reserve Bank of India and speculation has been rife that the RBI Chief may resign from his post.
Citing personal reasons for his resignation, Urjit Patel also said, “It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years. The support and hard work of RBI staff, officers and management has been the proximate driver of the Bank’s considerable accomplishments in recent years. I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future.”
In October, RBI Deputy Governor Viral Acharya had gone on record that governments that do not respect the RBI’s independence incur the wrath of financial markets. Government had recently asked the RBI to relax lending restrictions on some banks. The RBI also opposed a suggestion by the government’s inter-ministerial committee to set up an independent regulator for payment systems.
The Opposition was also taken by surprise by this move and Rahul Gandhi responded to the development thus: “RBI governor is resigning because he’s protecting the institution of RBI. Taking away reserves from RBI to save your skin is an act against this nation. I am very proud that people from all walks of life and institutions are standing up to it.”