In defence of RBI's Raghuram Rajan

Contrary Subramanian Swamy's beliefs, global investing community has been all praise for Raghuram Rajan and his policies

Bharatiya Janata Party (BJP) leader Subramanian Swamy, reports say, has written to Prime Minister Narendra Modi to remove Reserve Bank of India (RBI) Governor Raghuram Rajan whose three-year term at the helm comes to an end in September 2016.

In his letter to the PM, according to reports, Subramanian Swamy has accused Raghuram Rajan of an "apparently deliberate attempt to wreck the Indian economy," and contends that the RBI governor is "mentally not fully Indian." since he continues to renew the Green Card issued to him by the US government. 

Rajan has been credited by many to have kept Indian economy in safe hands at a time when the global growth was slowing. During his tenure, the former International Monetary Fund (IMF) chief economist has led the fight against inflation and pushed the state-run banks to clean up their balance sheets.

 

And the global investing community isn't complaining. On the contrary, they have been all praise for the RBI governor regarding the way he has handled the Indian economy over the past couple of years, especially at a time when global growth was slowing.

Here is a quick compilation of what leading global investment guru's had to say about Raghuram Rajan as the RBI governor and his policies in interviews with Business Standard, or across reports.

Christopher Wood

Christopher Wood, managing director & equity strategist, CLSA

In GREED & fear's view, Rajan's policy is refreshing in the context of the monetary quackery going on in the G7 world, quackery which the Indian central bank governor has done the best job of criticising among all the world's central bankers (CLICK HERE FOR THE STORY)

Timothy Moe, chief Asia-Pacific regional equity strategist, Goldman Sachs

From a cyclical standpoint, we think the economy is also on the upward trajectory and that’s helped by a more accommodative central bank. Interest rates and inflation have been coming down. All this is starting to filter down to the corporate earnings cycle, which is the key thing driving markets (CLICK HERE FOR THE STORY)

 

Jim Rogers, chairman of Rogers Holdings

India is not different from the rest of the world. Your central banker is less bad than most (central bankers across the globe). However, the Indian government doesn’t seem to understand economics and they don’t seem to do what’s necessary to make India the economic power it has been many a time in the past. (CLICK HERE FOR THE STORY)

Mark Mobius

Mark Mobius, executive chairman, Templeton Emerging Markets Group, Franklin Templeton Investments

The RBI Governor is very cautious and the way economies are slowing down, he could take measures to try to block that by lowering rates and other policy measures so that the Indian economy doesn't get stuck in a downward spiral. (CLICK HERE FOR THE STORY)

Shankar Sharma, vice-chairman and joint managing director, First Global

I think Raghuram Rajan got pressured into cutting rates. Ideally, he would have liked to wait a quarter more to cut rates, especially with the fiscal deficit situation being worrisome to say the least (CLICK HERE FOR THE STORY)

Andrew Holland

Andrew Holland, chief executive officer, Ambit Investment Advisors

There is a lot of foreign press now questioning whether Narendra Modi's reign has actually done the changes he should have. That has started to impact foreign institutional investors' sentiment as well. (CLICK HERE FOR THE STORY)

Rabobank International

All the reforms worth noting have been from the Reserve Bank of India; the government has only been tinkering for now, although we have high hopes for the goods and services tax Bill. (CLICK HERE FOR THE STORY)

Jan Dehn, head of research, Ashmore Investment Management

India is one of the brighter spots. The economic cycle is on a gentle upswing and policy credibility has dramatically improved, due to better fiscal and monetary policies. The fly in the ointment remains Parliament, which seems bent on maintaining a very myopic perspective on India. India has huge potential, but Parliament holds back the country. (CLICK HERE FOR THE STORY)