*RBI governor Urjit Patel resigned from his post just ahead of result of assembly polls.
*Perhaps for the first time in the history of Reserve Bank of India (RBI), a governor has resigned from his post
TIA WEB DESK
Reserve Bank of India (RBI) governor Urjit Patel resigned today citing personal reasons. “On account of personal reasons, I have decided to step down from my current position effective immediately. 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“, said Urjit R. Patel in a statement.
There was speculation of his resignation after deputy governor Viral Acharya’s speech last month that sought to defend the autonomy of the RBI and the subsequent differences between the government and the RBI over various issues related to related to liquidity, credit flow and the controls governing weak banks.
Patel’s decision was announced post-market hours and a day before assembly election results in five states. The markets could see a bloodbath on Tuesday if election results throw up a negative surprise, analysts said.
“The development came as a bolt from the blue. This was not expected at all. The markets were under the impression that the relationship between the government and the RBI had thawed over time. If the state polls throw up any negative surprise for the current dispensation at the Centre, expect a bloodbath on Dalal Street on Tuesday,” said Ambraheesh Baliga, an independent market analyst.
The rift between the RBI and the government turned ugly after RBI deputy governor Viral Acharya in October went public saying undermining a central bank’s independence could be “potentially catastrophic.”