How the who's who of politics and financial markets reacted to Rajan's exit

How the who's who of politics and financial markets reacted to Rajan's exit

RBI Governor Raghuram Rajan on Saturday said no to the second term as the head of the central bank. 

After months of speculations, Rajan said he will not take up second term and he will return to academia when his current term ends on September 4, he said in a message to central bank staff.

As the news spreaded, the economists, industrialists and top entrepreneurs shared their views on Rajan's exit. For some, the news was a "shock" while some hailed Modi government for his exit.

Here's what how they reacted:

Government officials and Oppositions

Arun Jaitley

Finance Minister Arun Jaitley on Twitter: “The Government appreciates the good work done by him and respects his decision. A decision on his successor would be announced shortly.”

Subramanian Swamy

Lawmaker Subramanian Swamy -- the Modi ally who’d been seeking Rajan’s dismissal, claiming he’d kept interest rates too high and stifled growth -- on Twitter: "My admiration for Namo has gone up hugely. Media, industrialists, and international bureaucrats piled on him for R3, but he did not bend." Swamy was using "Namo" to refer to Modi and "R3" for Rajan.

Rahul Gandhi

Rahul Gandhi, a leader of the opposition Congress party, on Twitter: "Prime Minister Narendra Modi knows everything. He has no need for experts like Raghuram Rajan."

Palaniappan Chidambaram

Palaniappan Chidambaram, former finance minister under the previous government, in a statement: “The government had invited this development through a craftily planned campaign of insinuations, baseless allegations and puerile attacks on a distinguished academic and economist. As I had said some time ago, this government did not deserve Dr. Rajan. Nevertheless, India is the loser.”

Economists

Lawrence Summer

Harvard University Professor Lawrence Summers: "Ragu Rajan will be missed. He is one of the few central bank governors who has changed the regime in a major country. This is a major accomplishment. I hope very much for the sake of India and the global economy that his policy innovations are a foundation for what is to come."

Alberto Gallo

Alberto Gallo, head of macro strategies at Algebris Investments Ltd. in London, on Twitter: “We’ll miss his courage to go against consensus. Great loss for #India. Without Raghu #Rajan, prepare for short-term stimulus, higher inflation and bank losses later. #India makes one step forward, two steps back”.

Vikas Khemani

Vikas Khemani, chief executive officer at Edelweiss Securities Ltd. in Mumbai. CNBC-TV18 tweets that Khemani says Rajan’s exit will not be a major setback for the market and that the next governor will also do a good job.

Tirthankar Patnaik

Tirthankar Patnaik, economist at Mizuho Bank Ltd., by phone: “This is a negative surprise for India. In India’s impending macro scenario, Rajan’s presence would have been really, really important. Without him, things are likely to be much more difficult.

Amartya Sen, Nobel laureate

"We are losing one of the most skillful financial economic thinkers in the world. It is sad for the country and it is sad for the government of the country too. RBI is not a completely autonomous institution," Sen told a private TV channel.

Bankers

Arundhati Bhattacharya

State Bank of India’s Chairman Arundhati Bhattacharya in an e-mailed statement: "Dr. Rajan is a person of very high caliber, who has built ably on the reputation of our central bank and given it a very large measure of credibility."

Meera Sanyal

Former CEO and chairman of the Royal Bank of Scotland in India, Meera Sanyal tweeted: "Academia's gain is India's loss : Gov Rajan to return to Chicago on Sept 16. Swamy gets his way at the cost of India." 

Deepak Parekh

Housing Development Finance Corp. Chairman Deepak Parekh to BloombergQuint: “I don’t think it’s going to make a big difference -- that money is going to start going out because the governor has stepped down.”

Companies and ASSOCHAM

Narayan Murthy

Narayan Murthy, Co-Founder of Infosys, who had pitched for at least two more terms for Rajan, expressed sadness over the development and said Rajan deserved more dignity than what he was treated with.

Kiran Mazumdar-Shaw

Biocon Chairperson & Managing Director Kiran Mazumdar-Shaw tweeted: "RBI Gov Raghuram Rajan not seeking second term - Academic gain, RBI loss. He leaves a legacy of economic stability."

Mohandas Pai

Mohandas Pai said in a tweet that it is a "very sad day for us great talent driven away by alcontents,cronies...deeply concerned." 

Harsh Goenka

RPG Enterprises Chairman Harsh Goenka tweeted: "Globally acknowledged. Inflation warrior. Economic guru. Independent mind. Bank surge

Anand Mahindra

Mahindra & Mahindra Ltd. Chairman Anand Mahindra, cited by PTI: "In my travels around the world and encounters with leading overseas businessmen it became clear that during his tenure he greatly enhanced the credibility and bankability of India. I trust that a successor will be found who will continue and enhance the great work done by Governor Rajan.”

Vishal Sikka

"I am here (as Infosys CEO). I am a US citizen. I don't think he (Rajan) was a US citizen but I am a US citizen. Be that as it is phir bhi dil hai Hindustani (I am an Indian at heart). That is what should count," Infosys Chief Executive Officer and Managing Director Vishal Sikka said.

"He has been an extraordinary governor and we wish him all the best in his life and academia. I would love to see if there is some way to work together but he has done an extraordinary job and we wish him all the best," he added.

R Seshasayee

Infosys Chairman R Seshasayee said the resignation was "clearly Raghuram's choice".

"He has always been keen on academia. But having said that I do hope that we will have a leadership in RBI soon which would do the very very outstanding work that Rajan had started," Seshasayee added.

The Associated Chambers of Commerce & Industry of India

The Associated Chambers of Commerce & Industry of India, in an e-mailed statement attributed to Secretary General D.S. Rawat: “Dr. Raghuram Rajan leaving the RBI at a time when a tumultuous global economy poses several risks to India along with the banks grappling with an unprecedented challenge of mounting non-performing assets is quite unfortunate.

Written By: ZeeBiz WebTeam
Updated: Sun, Jun 19, 2016
02:06 PM IST
Mumbai, ZeeBiz WebDesk
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