Move Likely To Undermine Economy, Hurt Rupee: How International Media Reported Urjit Patel Resignation
Many prominent news outlets noted that Patel's resignation came amid clashes between RBI and Modi.
Urjit Patel’s resignation as the Reserve Bank of India (RBI) governor on Monday, December 10 came as the end to long-winding speculation about him quitting his post while in tenure. It did not take long for the news to spread like wildfire with not only national media, but also international media offering their perspectives on what Patel’s resignation meant for the state of Indian economy, hereon.
BBC noted that Patel’s resignation came “amid reports of a rift between the Reserve Bank of India (RBI) and Prime Minister Narendra Modi’s government.” BBC also observed that Patel was the first time any RBI governor had submitted his resignation partway through his term. “This marks a rare case of a serving governor leaving his job midway through his five-year term,” said BBC, adding, “Correspondents say the move is likely to undermine confidence in the economy and cause the rupee to fall.”
Although it published a matter-of-fact report on Patel’s resignation, the Wall Street Journal, too, cited differences between the Narendra Modi-led Bharatiya Janata Party (BJP) government and Patel as the reason for him quitting. “Mr Patel and the central bank had come under pressure in recent months from the government of Prime Minister Narendra Modi over policy, with New Delhi urging the RBI to ease lending rules for state-run banks and transfer surplus funds to the government,” said the Washington Post article.
In its report, Financial Times stated Patel’s resignation came before a crucial meeting between the RBI governing board and the central bank officials. “His (Patel’s) decision comes ahead of what was likely to be a tense meeting on Friday, when the RBI’s governing board will be pushing the RBI to make many concessions to governments,” the FT report mentioned.
Another FT report on the story quoted Eswar Prasad, a professor at Cornell University. Prasad said that Patel’s abrupt departure “is a dark day for the RBI, and marks the culmination of the government’s taking the hammer to a cherished and widely respected institution”.
“By forcing Mr Patel’s hand, the government has now made it clear who runs the show,” he added.