Patel, 52, joined RBI as Deputy Governor on January 11, 2013, and was given a second term in January.
As deputy governor, Patel headed the RBI panel to draft the monetary policy report, which became the basis of the ongoing reforms at the apex bank.
The Patel committee report also formed the basis of the monetary policy committee, which takes away a lot of powers of RBI and the governor, as also move to create a public debt management agency.
Saying that Urjit Patel as next RBI Governor will bring “great continuity” at the central bank, his fellow Deputy Governor S S Mundra said, describing him as “a man of clear opinion who may bring some changes”.
“We all are very happy. Being a colleague, he brings great continuity and familiarity. He has a clear understanding of what is going on,” the Deputy Governor said.
Finance Minister Arun Jaitley also wished the best for the Governor elect Patel and said he will lead RBI to develop Indian economy.
“I am sure Urjit Patel will successfully lead RBI and contribute to India’s economic development,” said FM Arun Jaitley
Under the independent monetary policy committee, which is being set up, the government will set an inflation target to RBI and the governor will be made answerable to Parliament if he/she fails to contain inflation within target.
Prior to his appointment as the deputy governor, Patel was Advisor (Energy & Infrastructure), The Boston Consulting Group.
He is a Ph.D. (Economics) from Yale University (1990) and M Phil from Oxford (1986) and has been a non-resident Senior Fellow at the The Brookings Institution since 2009.
Patel was with the International Monetary Fund (IMF) between 1990 and 1995, and worked on the US, India, Bahamas and Myanmar desks. He was also a Consultant (1998-2001) to the Ministry of Finance, Department of Economic Affairs, New Delhi.
Hailing Urjit Patel’s appointment as RBI Governor as “vote for continuity”, India Inc and experts are unanimous that he is an excellent choice for the top job at the central bank when the economy is passing through a crucial phase.
“We all are very happy. Being a colleague, he brings great continuity and familiarity. He has a clear understanding of what is going on,” said RBI Deputy Governor S S Mundra.
Patel’s appointment puts an end to the tradition of continuing RBI Governors for at least two terms.
Rajan will be the first Governor since 1992 to not have a five year term. His predecessors — D Subbarao (2008-2013), Y V Reddy (2003-2008), Bimal Jalan (1997-2003) and C Rangarajan (1992-1997) — had five-year terms.
Earlier commenting on Rajan’s short tenure, a top finance ministry official had said that no individual can be bigger than an organisation.
A former chief economist at the International Monetary Fund (IMF), Rajan was appointed RBI Governor by the previous UPA government. He is currently on-leave professor at the Chicago Booth School of Business, and had on several occasions run into opinion difference with the government.
The outspoken governor soon became an eyesore for many, not only because of his views on economic reforms and independence of RBI, but also on social issues.
Rajan was under attack from BJP MP Subramanian Swamy for his inflation centric monetary policy. Swamy who had accused Rajan of being “mentally not fully Indian”, also said that it was because of his policies that growth has stifled.
The RBI Governor, however, allayed all such comments as mere “dialogues” and asked his critics to show how inflation is low.
“I am not sure where we are behind the curve. You have to tell me that somehow inflation is very low for us to be seen as behind the curve,” Rajan had said.
Rajan, in a surprising move on June 18, said he will step down on September 4, at the end of the three-year term.