Rakesh Mohan, previously deputy governor of RBI, at a banking conference in Mumbai (Photographer: Prashanth Vishwanathan/Bloomberg)

Sad Day For The RBI, Says Former Deputy Governor Rakesh Mohan

Former Reserve Bank Deputy Governor Rakesh Mohan said he is “shocked” and “deeply saddened” that things came to such a point where Governor Urjit Patel had to resign.

“If indeed it is not due to personal reasons, there must’ve been enough pressing reasons for him to take the ultimate step, to have enough differences which were not being resolved,” Mohan told BloombergQuint in an interaction. “I do hope that steps are taken to stabilise the situation and restore the credibility of the central bank in the country.”

Mohan explained that it is usually the senior-most deputy governor at the RBI who assumes charge in such a situation.

“The way the Reserve Bank is structured is that there is always at a given point in time a pecking order among the deputy governors,” Mohan said. “Essentially, dependent on the date of them being appointed. I am not sure who is the senior-most but automatically the senior-most deputy governor assumes charge in such a situation, if and when it arises.”

I would imagine the government will have to be deliberate about its choice of governor because it will have to restore confidence in the joint functioning of the RBI and the centre.
Rakesh Mohan, Former Deputy Governor, RBI

Watch the full conversation here: