S Gurumurthy backs Shaktikanta Das's views on govt-RBI relations

RBI governor is right in Govt & RBI role, says Gurumurthy

The new governor of Reserve Bank of India (RBI), Shaktikanta Das received the backing of S Gurumurthy, the RSS ideologue and RBI board member, for his first comment about the government-RBI relation. 

Das, in his first press interaction, said that there needs to be a discussion between the government and RBI. He stated that the government is not just a stakeholder, but it runs the country, economy and manages the policies.

Gurumurthy, who did not respond to messages and calls for a comment on Das's appointment, tweeted an article on Thursday, which quoted the RBI Governor saying 'the government is not just a stakeholder but also runs country, economy'.

Gurumurthy tweeted, "This is the correct view. It is not Govt vs RBI. It is Govt & RBI".

Gurumurthy, who was appointed to the board of RBI in August, expressed his surprise when Urjit Patel resigned as the Governor of RBI. He went on to say "the previous meeting was held in such a cordial atmosphere that it comes as a shock. All directors said media had created a wrong perception while inside it was totally different. That makes it even more surprising".

"I enjoyed several hours of personal discussions with him where we found large areas of agreement as well as mutually understandable disagreement. His resignation is indeed set back to the effects of the convergence of views that was taking place. We will miss him," he said through his social media account.

According to reports, Gurumurthy had earlier complained to the RBI Governor about the statements made by Deputy Governor Viral Acharya that the government's moves to undermine RBI's independence may end up in a crisis of confidence in capital markets and other impacts.

Meanwhile, Das declined to share his view on farm debt waiver scheme saying he won't give views on all aspects. His two predecessors — Raghuram Rajan and Urjit Patel — had opposed such schemes due to a detrimental effect on credit discipline.

In the run-up to Lok Sabha elections in April-May 2019, the union government is mulling loan waiver scheme for farmers. While the banks get compensated by governments — centre and state — that announces such scheme, the harm to bank's balance sheet are much more as borrowers stop repayments in anticipation of such scheme.