The governor of India’s central bank has decided to “move on” and a hunt for his successor is underway, the country’s finance minister was quoted as saying yesterday.
Reserve Bank of India (RBI) governor Duvvuri Subbarao’s five-year term ends on Sept. 4, but there has been media speculation that he may receive an extension.
“Dr Subbarao had met me a few weeks ago and said he would like to move on and he would not like to be considered for another term,” Indian Minister of Finance P. Chidambaram told the Economic Times newspaper.
“I accepted, so now we are in search mode,” Chidambaram said.
Subbarao had indicated that he wanted to leave on time next month, but media speculated that the Indian National Congress Party-led government would prefer not to make changes until after national elections due in May.
The central bank has been in crisis management mode in recent weeks as it attempts to steady the ailing rupee, which hit a record low against the US dollar last month.
The bank is also under pressure from business to cut interest rates to spur economic growth, which is running at a decade low of 5 percent.
Subbarao issued his last monetary policy statement as governor on Tuesday, when he held interest rates steady as the bank focuses on trying to keep the rupee stable rather than pushing for growth.
The bank also lowered India’s growth forecast from 5.7 percent to 5.5 percent, as the government struggles to kickstart the economy.
Subbarao, 63, an economist and civil official, was appointed RBI head in 2008 during the global financial crisis.
He was given a two-year extension in September 2011.
Under his watch, India’s economy has gone through a tough phase, hit by decade-low growth, high inflation, a record low for the Indian currency and a steep current account deficit.
An independent thinker, Subbarao, in recent years faced criticism from Indian business leaders and the government for not easing monetary policy to spur economic growth.
Indian Chief Economic Adviser to the Government Raghuram Rajan, Secretary of Economic Affairs Arvind Mayaram and Planning Commission member Saumitra Chaudhary are contenders to succeed Subbarao, the newspaper said.