"He Came, He Saw, He Conquered" and He Left. He was animated, exuberant, stylish and articulate. He gave expression to his views without reservation and this probably was his undoing also.
Leadership of central banks requires clarity of thought and obfuscation of expression. Raghuram Rajan excelled in the former and was incapable of the latter.
Rajan seems to know when to leave. He has chosen to depart when economic climate is more bright than dark. He has not allowed his admirers to discover his feet of clay. RBI Governor's success depends more on circumstances and less on his / her brilliance. Deciding to leave when circumstances are fairly healthy is a master stroke.
RBI Governors in the past have generally been given two terms. Being restricted to one term with rampant rumours of a conspiracy against him means that Rajan gets sympathy in addition to admiration. This is indeed the Goldilocks time to let go of the Governorship.
Some may call him a quitter. His mom-in-law who wants him to be a karma yogi will not be happy with his decision.
Subramanian Swamy goes about blaming Rajan for his allegedly hawkish stand on interest rates which according to him has distressed many industrial units. But, leaders of industry have almost unanimously regretted his early departure. Swamy's argument flies in the face of empirical evidence.
Rajan's best legacy is what he did to banks' Balance Sheets and wilful defaulters. It is hoped that his successor will emulate him on this. His successor (Rakesh Mohan, Arvind Panagariya, Arvind Subramanian, Arundathi Bhattacharyya or who?) will have a tough time because the benchmark will be Rajan's methodical performance.
In his farewell message to RBI employees, Rajan says he is always available to serve the country. The country needs him now more than ever and he has chosen to walk back into distant academia. Of course, no one is indispensable. We will get over Rajan-mania sooner than expected.
Leadership of central banks requires clarity of thought and obfuscation of expression. Raghuram Rajan excelled in the former and was incapable of the latter.
Rajan seems to know when to leave. He has chosen to depart when economic climate is more bright than dark. He has not allowed his admirers to discover his feet of clay. RBI Governor's success depends more on circumstances and less on his / her brilliance. Deciding to leave when circumstances are fairly healthy is a master stroke.
RBI Governors in the past have generally been given two terms. Being restricted to one term with rampant rumours of a conspiracy against him means that Rajan gets sympathy in addition to admiration. This is indeed the Goldilocks time to let go of the Governorship.
Some may call him a quitter. His mom-in-law who wants him to be a karma yogi will not be happy with his decision.
Subramanian Swamy goes about blaming Rajan for his allegedly hawkish stand on interest rates which according to him has distressed many industrial units. But, leaders of industry have almost unanimously regretted his early departure. Swamy's argument flies in the face of empirical evidence.
Rajan's best legacy is what he did to banks' Balance Sheets and wilful defaulters. It is hoped that his successor will emulate him on this. His successor (Rakesh Mohan, Arvind Panagariya, Arvind Subramanian, Arundathi Bhattacharyya or who?) will have a tough time because the benchmark will be Rajan's methodical performance.
In his farewell message to RBI employees, Rajan says he is always available to serve the country. The country needs him now more than ever and he has chosen to walk back into distant academia. Of course, no one is indispensable. We will get over Rajan-mania sooner than expected.
1 comment:
Excellent analysis.
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