Mumbai: Financial Times newspaper has named Raghuram Rajan as one of the top contenders for the job of Bank of England governor when incumbent Mark Carney’s term ends next year.
This is at least the second time that the former Reserve Bank of India (RBI) governor’s name has been mentioned as a candidate for a top central bank. In October, financial magazine Barron’s had said that Rajan would be the ideal choice to chair the US Federal Reserve, a role that eventually went to Jerome Powell.
Financial Times said that attracting Rajan would be a “coup" for Bank of England.
A mail sent to Bank of England was not answered till press time.
Rajan’s career progression has been truly global. He worked as chief economist at the International Monetary Fund from October 2003 to December 2006. Rajan went back to academia after completing his three-year term as RBI governor in 2016. He is currently professor of finance at the University of Chicago Booth School of Business.
Rajan shot to prominence on the global stage in 2008 when the US sub-prime crisis started unravelling. Three years earlier, speaking at the US Federal Reserve’s annual Jackson Hole conference, Rajan had warned about growing risks to financial system and called for putting in place policies to mitigate these risks. His views were criticized then, but the onset of the crisis silenced his detractors.
His assignment as RBI governor was also dramatic. He took over in September 2013, when the Indian currency was in a free fall, foreign exchange reserves were depleting and the country’s current account deficit was widening. Within days of taking charge, Rajan, an alumnus of the prestigious Indian Institute of Technology, Delhi, and Indian Institute of Management, Ahmedabad, had helped stem the rupee’s fall and managed to assuage jittery investors. He was credited with putting sex back into the falling ‘Sensex’, India’s benchmark equity index, society columnist Shobhaa De wrote.
In his three years at RBI, Rajan was never short of quotable quotes, a quality that set him apart from his predecessors. Rajan spoke his mind and never minced his words. Naturally, he had a few run-ins with the government for his comments on its flagship Make in India programme, fiscal policies, and banking sector reforms, to name a few. While previous governors also had such run-ins, in Rajan’s case, these were not just limited to monetary economics but also expanded to topics such as academia and the culture of debate.