Urjit Patel resigned as RBI Governor

Reserve Bank of India (RBI) Governor Urjit Patel on Monday, 10 December, 2018 stepped down from his position with immediate effect. It`s making him the first governor since 1990 to step down before his term ends. Patel was appointed as 24th RBI Governor on September, 2016 for a three-year term was to end in September 2019. But before the completion of tenure Urjit Patel resigned as RBI Governor.

Urjit Patel citing the following statement:

“On account of personal reasons, I have decided to step down from my current position effective immediately. It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years. The support and hard work of RBI staff, officers and management has been the proximate driver of the Bank’s considerable accomplishments in recent years. I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future.”

Urjit Patel and Government

His resignation comes against the backdrop of increasing tensions between the Finance ministry and the RBI. Urjit Patel, 55, who took over as the 24th Governor of the central bank on September 5, 2016, had the shortest tenure since the year 1992. After previous governor Raghuram Rajan denied a second term, Central Government hand-picked Urjit Patel for Governor position.

After Urjit Patel resigned as RBI Governor, a government official told that the RBI Governor had not informed the government before resigning. India will appoint a governor as soon as possible.

Shantikanta Das: New Governor

There are many speculations that former Finance Secretary Shaktikanta Das is a possible contender for RBI Governor. Das is currently a member of the Finance Commission. Vishwanathan was appointed as RBI Deputy Governor on July 4, 2016 for a period of three years.

The next RBI board meeting was scheduled for December 14, 2018. Patel has resigned just four days before that.

Appointment and Resignation Process of RBI Governor

Who can appoint RBI Governor?

As per Section 8 (1) (a) of RBI Act, 1934, Central Government can appoint the RBI governor as well as deputy governor in India.

To whom RBI Governor can submit his resignation?

RBI Governor can tender his resignation to the Central Board of RBI. He shall also inform to the Central Government about the resignation.

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