Finally, Urjit Patel steps down as RBI Governor

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Finally, Urjit Patel steps down as RBI Governor

Though it is widely believed that Patel has resigned from his post following a rift with the government, he cited "personal reasons" for the move

Monday December 10, 2018 7:20 PM, ummid.com News Network

New Delhi: More than a month after reports claimed that Urjit Patel is considering to resign as Reserve Bank of India (RBI) Governor, he finally stepped down from his post Monday.

Though it is widely believed that Patel has resigned from his post following a rift with the government, he cited "personal reasons" for the move.

“On account of personal reasons, I have decided to step down from my current position effective immediately. It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years,” Patel wrote in an statement issued by the RBI.

“The support and hard work of RBI staff, officers and management has been the proximate driver of the Bank’s considerable accomplishments in recent years. I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future,” he added.

Urjit Patel was elevated from deputy governor's position to the post of RBI Governor when Raghuram Rajan exited the RBI governor’s office in September 2016. He was considered as the Modi government's blue-eyed boy. The belief was validated in November 2016 when the demonetisation was announced and the RBI under him endorsed the controversial move, reportedly opposed very strongly by Rajan.

The reports of Urjit Patel's resignation surfaced amidst the rift between RBI and the government over various issues.

The rift between the two started after the government demanded that RBI eases its lending restrictions on banks that have a low capital base and a massive rise in bad debts. Another contentious issue is the control over interest rates. While the RBI wants sole authority over raising or lowering the interest rates, the government is unhappy over its decisions.

But, Urjit Patel resigned from his post after the government and the RBI broke the ice and resolved the differences. The central bank and the board on November 19 reached an agreement on providing relief to small and medium firms and easing lending restrictions on some state-owned banks.

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