P.Chidambaram questions, whether BJP government deserves Raghuram Rajan?


Taking a jab at the central government, former Congress finance minister P. Chidambaram on Saturday doubted whether the Narendra Modi-led BJP government deserves RBI Governor Raghuram Rajan and portrayed him as “one of the most outstanding economists” in the world.

“I wonder whether this government deserves Dr. Rajan.” Chidamabaram replied when asked whether the RBI governor to be given a second term.

The Reserve Bank of India (RBI) governor's three-year term ends in the first week of September. BJP leader Subramanian Swamy has been consistently urging that Rajan should not be given an extension.

“UPA government appointed one of the most outstanding economists of the world as the governor of RBI. We placed full trust and confidence on him at that time, and even continue to place full trust today,” Chidambaram added.

The former finance minister chose not to comment on Swamy's letter to the prime minister asking him to pack Rajan.

"If the finance minister or PM makes similar comments I will comment. In the absence of the finance minister with any similar comment, there is no need for Congress party to respond back," Chidambaram told media persons.

To a question on Finance Minister Arun Jaitley having differences with Rajan on the issue of interest rates, Chidambaram said: "All over the world, finance ministers and central bank governors are engaged in some issue or another, but that doesn't mean finance minister is questioning the competency of the RBI governor. Everyone approaches the economy in his or her perspective. Government's perspective is growth and central bank governor's perspective is monetary stability."

He further said: "As far as we are concerned, we had the best of relationship with all central bank governors and as long as we were in government, we had the best relationship with Dr Raghuram Rajan."

He also took a dig at Union Commerce and Industry Minister Nirmala Sitharaman when asked about her criticism of Rajan.

"If I can put the question by a straw vote by this audience, between Dr. Rahguram Rajan on one hand and the commerce minister on the other, you know how the vote will take place?" said Chidambaram.

Indicating that the RBI and the government were not on the same page on various issues, Chidambaram said: "CPI (consumer price index) inflation has risen from 3.7 percent in July 2015 to 5.4 percent in April 2016.

"It is not clear whether the government and the RBI are agreed on the strategy for inflation management. In absence of an agreed strategy, inflation is bound to increase," he said.