Mumbai, 1 June-2014(PTI): Ahead of monetary policy review on Tuesday, Reserve Bank of India (RBI)…
New Delhi (PTI): As questions cropped up over whether the announcements on major FDI reforms had anything to do with the Raghuram Rajan’s exit from RBI, government said they were in the works and only an announcement was made on Monday.
“We were working on these (FDI reforms) for couple of months. We have made the announcements after the work has been finished. Can it be done in one day?,” Commerce and Industry Minister Nirmala Sitharaman asked.
Read: RBI chief Raghuram Rajan defends record, inflation fight
At a media briefing, she was asked why the government chose to make the announcements today when there was a ‘hangover’ of Rajan’s decision to leave RBI.
Congress spokesman Jairam Ramesh described the decisions as a “panic reaction” which would not have come had Rajan not made the announcement. He also said the Congress does not believe that FDI is a magic wand.
Commenting on Rajan’s decision, Sitharaman earlier in the day said: “the government’s line is very nicely explained by the Finance Minister on this. We appreciate the work that the RBI governor has done and he has taken a call to end his tenure and he is going back to academia and we respect that”.
Read: No search panel for Rajan successor, govt to announce new RBI chief soon
When pressed further on the issue, she said: “I am not adding to speculation at all. The government’s position is explained. He has taken a call, we respect his tenure and we respect his contribution”.
When asked why Rajan has been given “the shortest tenure”, the minister said during Rajiv Gandhi’s time, a “Governor was appointed and removed within 20 days”.
A Ghosh remained RBI Governor for a very shor