Tue, Jun 25, 2019 - Page 10 News List

Indian central bank to lose second outspoken official

Bloomberg

The Reserve Bank of India (RBI) is to lose one of its most outspoken officials, further raising questions about the independence of the central bank six months after the governor resigned under a cloud.

Deputy bank Governor Viral Acharya has asked to leave no later than July 23, citing “unavoidable personal circumstances,” the RBI said in a statement yesterday.

His resignation request, which was submitted a few weeks ago, is under consideration, it said.

Acharya, who was in charge of the monetary policy department, is to return to New York University in August as an economics professor, the Business Standard newspaper reported earlier.

A monetary policy hawk, Acharya joined the RBI in January 2017 for a three-year term. His departure will be the second high-profile exit after Urjit Patel suddenly resigned as governor in December last year amid a clash with the government about the bank’s independence.

Those differences — on lending rules to interest rates — were first brought to view by Acharya in a speech in October last year.

At the time, he used the example of the financial market meltdown in Argentina in 2010 to warn about the dangers of a government meddling with the RBI’s independence.

After Patel quit, the RBI under Governor Shaktikanta Das has cut interest rates three times and given up its tight policy stance.

Acharya was the only deputy governor on the six-member monetary policy committee, and his departure leaves the door open for more easing to support a slowing economy.

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