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Business News/ Politics / Policy/  RBI vs Govt: Timeline of events leading to Urjit Patel resignation
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RBI vs Govt: Timeline of events leading to Urjit Patel resignation

Government has reiterated the need for RBI autonomy as 'essential' but called for better governance at the central bank

Urjit Patel has resigned as RBI governor citing personal reasons. Photo:APPremium
Urjit Patel has resigned as RBI governor citing personal reasons. Photo:AP

The following is a timeline of the events in the government- RBI spat, leading to Patel’s sudden resignation 8 Aug, 2018: Government appoints die-hard Sangh ideologue S Gurumurthy, and cooperative banker and Swadeshi supporter Satish Marathe to the RBI’s central board as independent directors.

Mid-Sep: Government cuts short the term of RBI central board member and noted banker Nachiket Mor, who is also associated with the Bill & Melinda Gates Foundation.

10 Oct: Government invokes the never-before-used Section 7 of the RBI Act to force down decisions it wants RBI to take through three letters with over a dozen demands. RBI replies to these letters a week later.

23 Oct: RBI holds a marathon board meet that lasts for around eight hours but remains inconclusive on most issues that government brought in.

26 Oct: Deputy governor Viral Acharya goes public to assert RBI’s autonomy, warns of the wrath of the markets if it is not maintained through a speech.

29 Oct: Another deputy governor NS Vishwanathan delivers a speech in Jamshedpur, making clear RBI’s reluctance to bring down capital levels for banks.

31 Oct: Government reiterates need for RBI autonomy as “essential" but calls for better governance at RBI.

3 Nov: Economic affairs secretary SC Garg cites improvements in market indices, the rupee and crude to make light of Acharya’s “wrath of markets" remarks.

9 Nov: Garg says discussions are on to fix an ‘appropriate economic capital framework for RBI’ and say it government does not want the RBI money.

15 Nov: RSS ideologue and central board member S Gurumurthy says standoff between RBI and government not a “happy thing".

17 Nov: Ahead of RBI board meeting, finance minister Arun Jaitley says growth should not be throttled by squeezing liquidity to the needy sectors.

19 Nov: A 10-hour RBI central board meeting decides to set up a panel on the economic capital framework for RBI and directs it give forbearances to small businesses.

5 Dec: Governor Urjit Patel refuses to answer queries on frictions between RBI and government, amid reports of truce between the two.

10 Dec: Patel resigns, citing personal reasons.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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Published: 10 Dec 2018, 08:40 PM IST
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