Advocating for more clarity on the rank of Reserve Bank of India head, former RBI Governor Raghuram Rajan in his new book, ‘I Do What I Do’, states that it is not proper to treat the central bank chief “as just another bureaucrat”.
“The mistake on all sides is to treat the RBI governor as just another bureaucrat. If the governor takes this mistaken view, he ends up being subservient to the central and state governments and not offering an independent technocratic perspective that could keep the nation from straying into economic distress,” Rajan wrote.
He further writes that if the government takes the mistaken view that RBI governor is just another bureaucrat, it will be “displeased when it sees the governor deviating from the usually deferential behaviour of bureaucrats and it will strive to cut him down to size. This does not serve the country either.”
The book, a compilation of Rajan’s speeches and essays, also states, “There is a danger in keeping the position ill-defined, because the constant effort of the bureaucracy is to whittle down its power. This is not a recent phenomenon…the RBI risks becoming dangerously weakened as successive governments and finance ministers misunderstand its role.”