The Indian government appointed career central banker Michael Patra as one of the <a href="https://www.wionews.com/business-economy/owing-to-rising-food-prices-indias-december-retail-inflation-surges-to-735-274063">Reserve Bank of India's</a> four deputy governors for a three-year term, it said in a statement on Tuesday.

He will fill a vacancy left by former deputy governor Viral Acharya, who resigned last June, six months before the scheduled end of his term in office.

Acharya cited personal reasons for his departure but had previously clashed with Prime Minister <a href="https://www.wionews.com/india-news/p-chidambaram-attacks-modi-govt-over-sliding-economy-and-unemployment-274135">Narendra Modi's</a> government over an erosion of the central bank's independence.

He was the third key senior central bank official under the Modi government to resign, following the departures of former RBI governors Raghuram Rajan in 2016 and Urjit Patel in December 2018.

Patra, currently an executive director at the RBI, had applied for a deputy governor's post in 2017.

He has been a part of the central bank's monetary policy committee since its inception and has long been viewed as a monetary policy hawk.

However, since Governor Shaktikanta Das took office in December, Patra has voted for three successive rate cuts and has said the economy needs fiscal support in the current environment.

"It's an excellent decision. He is an accomplished monetary economist with not just strong academic credentials but also has a rich understanding of ground-level economic realities of India. This is the best choice in my opinion," said <a href="https://www.wionews.com/business-economy/indias-october-retail-inflation-rises-to-462-per-cent-261864">Rupa Rege Nitsure</a>, chief economist at L&amp;T Financial Holdings.

The Indian government appointed career central banker Michael Patra as one of the Reserve Bank of India's four deputy governors for a three-year term, it said in a statement on Tuesday.

The Indian government appointed career central banker Michael Patra as one of the Reserve Bank of India's four deputy governors for a three-year term, it said in a statement on Tuesday. He will fill a vacancy left by former deputy governor Viral Acharya, who resigned last June, six months before the scheduled end of his term in office. Acharya cited personal reasons for his departure but had previously clashed with Prime Minister Narendra Modi's government over an erosion of the central bank's independence. He was the third key senior central bank official under the Modi government to resign, following the departures of former RBI governors Raghuram Rajan in 2016 and Urjit Patel in December 2018. Patra, currently an executive director at the RBI, had applied for a deputy governor's post in 2017. He has been a part of the central bank's monetary policy committee since its inception and has long been viewed as a monetary policy hawk. However, since Governor Shaktikanta Das took office in December, Patra has voted for three successive rate cuts and has said the economy needs fiscal support in the current environment. "It's an excellent decision. He is an accomplished monetary economist with not just strong academic credentials but also has a rich understanding of ground-level economic realities of India. This is the best choice in my opinion," said Rupa Rege Nitsure, chief economist at L&T Financial Holdings.

Government appoints Michael Patra as RBI Deputy Governor

RBI Deputy Governor Viral Acharya, who was in-charge of the monetary policy department, has resigned six months before the scheduled end of his term, sources said Monday.

This is the second high profile resignation in the past six month at the Reserve Bank of India (RBI).&nbsp;

In December, governor Urjit Patel resigned nearly nine months before the end of his schedule term over differences with the government.&nbsp;

Acharya had joined the central bank on January 23 last year after Patel was elevated to the post of governor in September 2016.

The RBI is now left with three deputy governors N S Vishwanathan, B P Kanungo and M K Jain.

Acharya, a New York University economics professor who once called himself the 'poor man's Raghuram Rajan', was appointed for three years.

He took over at a time when the central bank was facing criticism for repeated changes in the rules related to deposit and withdrawal of money, post-demonetisation.&nbsp; 
&nbsp;

RBI Deputy Governor Viral Acharya, who was in-charge of the monetary policy department, has resigned six months before the scheduled end of his term, sources said Monday.

RBI Deputy Governor Viral Acharya, who was in-charge of the monetary policy department, has resigned six months before the scheduled end of his term, sources said Monday. This is the second high profile resignation in the past six month at the Reserve Bank of India (RBI). In December, governor Urjit Patel resigned nearly nine months before the end of his schedule term over differences with the government. Acharya had joined the central bank on January 23 last year after Patel was elevated to the post of governor in September 2016. The RBI is now left with three deputy governors N S Vishwanathan, B P Kanungo and M K Jain. Acharya, a New York University economics professor who once called himself the 'poor man's Raghuram Rajan', was appointed for three years. He took over at a time when the central bank was facing criticism for repeated changes in the rules related to deposit and withdrawal of money, post-demonetisation.

RBI Deputy Governor Viral Acharya quits 6 months before his term ends

Reserve Bank of India Deputy Governor Viral Acharya has put in his papers about six months ahead of the completion of his term.

RBI Deputy Governor Viral Acharya quits

With the general elections expected to take place within the next six months, <a href="http://www.wionews.com/india-news/matter-on-rafael-deal-has-been-thouroughly-through-the-supreme-court-laid-to-rest-sitharaman-184062">Union Finance Minister Arun Jaitley</a> asserted that going forward, India cannot afford to have "fragile coalitions."

Addressing an annual gathering of the Federation of Federation of Indian Chambers of Commerce and Industry (FICCI) on Friday, Jaitley noted that the need of the hour was to formulate policies that have clarity, directional stability and decisive leadership, and establish a market economy with social consciousness for ensuring equitable growth.

"The next six months would see a rise in political rhetoric with voices which may not be the expression of the real intent. The need of the hour is continuation of sound policies as against transient populism. The immediate target should be one that spells out the recipe for the next two decades; for an India where further reforms would be the only constant for aspirational people whose attitude is for change and desire for a better quality of life," he said while addressing members of the industry body.

Jaitley further said that if the current growth rate and India's global position is retained, the country will be able to go beyond growth rate of 7-8 per cent. In order to achieve this, however, Jaitley said it is important to identify several unreformed sectors such as state road transportation, railways, dealing with urbanisation, focusing on science and technology and research.

"India has done extremely well in infrastructure areas such as aviation and ports and it must be ensured that these success stories are not converted into challenges for the economy," he added.

Amid reports of Urjit Patel stepping down as the Reserve Bank of India (RBI) governor over the central bank's alleged stifled autonomy, Jaitley clarified that the government was in no way trying to interfere in the autonomy of the central bank.

He further said he was unable to perceive how an elected, sovereign government which flags off issues of credit and liquidity could be construed as infringing on the autonomy of the institution.

"Autonomy is not synonymous with isolationism, and therefore, bringing issues of concern to the notice of the central bank should not be regarded as a hindrance to the autonomy of the RBI," Jaitley asserted.

A tiff between the RBI and the Centre allegedly ensued after RBI deputy Governor Viral Acharya earlier this year stressed on the need to ensure the central bank's independence.

On Thursday, former chief economic advisor Arvind Subramanian had opined that creative tension between the RBI and the Centre should exist in line with the autonomy of the central bank.

"We want autonomy and independence but along with communication and cooperation because both parts of the government (i.e RBI and government) have to work together as many of their objectives are common. There will be some objectives which are different and that's why we created RBI. They will never agree, they should never agree, there has to be a creative tension," he had said.

With the general elections expected to take place within the next six months, Union Finance Minister Arun Jaitley asserted that going forward, India cannot afford to have "fragile coalitions.

With the general elections expected to take place within the next six months, Union Finance Minister Arun Jaitley asserted that going forward, India cannot afford to have "fragile coalitions." Addressing an annual gathering of the Federation of Federation of Indian Chambers of Commerce and Industry (FICCI) on Friday, Jaitley noted that the need of the hour was to formulate policies that have clarity, directional stability and decisive leadership, and establish a market economy with social consciousness for ensuring equitable growth. "The next six months would see a rise in political rhetoric with voices which may not be the expression of the real intent. The need of the hour is continuation of sound policies as against transient populism. The immediate target should be one that spells out the recipe for the next two decades; for an India where further reforms would be the only constant for aspirational people whose attitude is for change and desire for a better quality of life," he said while addressing members of the industry body. Jaitley further said that if the current growth rate and India's global position is retained, the country will be able to go beyond growth rate of 7-8 per cent. In order to achieve this, however, Jaitley said it is important to identify several unreformed sectors such as state road transportation, railways, dealing with urbanisation, focusing on science and technology and research. "India has done extremely well in infrastructure areas such as aviation and ports and it must be ensured that these success stories are not converted into challenges for the economy," he added. Amid reports of Urjit Patel stepping down as the Reserve Bank of India (RBI) governor over the central bank's alleged stifled autonomy, Jaitley clarified that the government was in no way trying to interfere in the autonomy of the central bank. He further said he was unable to perceive how an elected, sovereign government which flags off issues of credit and liquidity could be construed as infringing on the autonomy of the institution. "Autonomy is not synonymous with isolationism, and therefore, bringing issues of concern to the notice of the central bank should not be regarded as a hindrance to the autonomy of the RBI," Jaitley asserted. A tiff between the RBI and the Centre allegedly ensued after RBI deputy Governor Viral Acharya earlier this year stressed on the need to ensure the central bank's independence. On Thursday, former chief economic advisor Arvind Subramanian had opined that creative tension between the RBI and the Centre should exist in line with the autonomy of the central bank. "We want autonomy and independence but along with communication and cooperation because both parts of the government (i.e RBI and government) have to work together as many of their objectives are common. There will be some objectives which are different and that's why we created RBI. They will never agree, they should never agree, there has to be a creative tension," he had said.

India cannot function with fragile coalitions in future: Arun Jaitley

The Reserve Bank Monday denied speculation about deputy governor Viral Acharya also quitting his job, terming them as incorrect and baseless rumours.

"Reports of deputy governor Acharya also having quit are baseless and incorrect," an RBI spokesperson told PTI.

Within minutes of Governor Urjit Patel announcing his decision to quit, there have been reports of Acharya also following suit.

Acharya had made the October 26 speech on the need to preserve the autonomy of RBI, which got the soured central bank-government relationship out into the public domain.

In the over 90-minute long speech, Acharya, who is in charge of the monetary policy department, warned of the wrath of the markets if the autonomy of a central bank is compromised. Acharya had explicitly said he had the backing of Governor Patel for making the speech.&nbsp;

The Reserve Bank Monday denied speculation about deputy governor Viral Acharya also quitting his job, terming them as incorrect and baseless rumours. "Reports of deputy governor Acharya also having quit are baseless and incorrect," an RBI spokesperson told PTI.

The Reserve Bank Monday denied speculation about deputy governor Viral Acharya also quitting his job, terming them as incorrect and baseless rumours. "Reports of deputy governor Acharya also having quit are baseless and incorrect," an RBI spokesperson told PTI. Within minutes of Governor Urjit Patel announcing his decision to quit, there have been reports of Acharya also following suit. Acharya had made the October 26 speech on the need to preserve the autonomy of RBI, which got the soured central bank-government relationship out into the public domain. In the over 90-minute long speech, Acharya, who is in charge of the monetary policy department, warned of the wrath of the markets if the autonomy of a central bank is compromised. Acharya had explicitly said he had the backing of Governor Patel for making the speech.

RBI says no basis to reports about Acharya quitting

Pitching for "effective independence", RBI Deputy Governor Viral Acharya Friday said governments that do not respect central bank's independence would sooner or later incur the wrath of <a href="http://www.wionews.com/opinions/markets-need-rbis-assurance-169531">financial markets</a>.

Amid instances of apparent differences between the government and the RBI, Acharya emphasised that undermining a central bank's independence is akin to committing a "self goal" for any government.

Wiser politicians will give a central bank necessary autonomy so that they reap electoral benefits of stable macroeconomic conditions which such independence will bring, Acharya said here.

Delivering the AD Shroff Memorial Lecture, he said, "What matters is the effective independence with which these powers (vested in the Acts governing the RBI or any central bank) can be exercised in practice."

"Governments that do not respect central bank's independence will sooner or later incur the wrath of financial markets, ignite economic fire and come to rue the day they undermined an important regulatory institution," Acharya said.

Noting that markets have a keen eye on this aspect, he said that if uncertainty grows and confidence in central bank's independence and credibility erodes, "then markets rap bond yields and exchange rate on the knuckles!"

"Wiser governments which accord the necessary leeway will benefit through lower costs of borrowing, the love of international investors and longer life spans," he said.&nbsp;

In recent months, the RBI and the government have been apparently differing on approach to certain issues, such as those pertaining to payment systems regulator and Prompt Corrective Action (PAC) norms for banks.

In his over 85-minute long speech, the academic-turned-central banker seemed to be expressing some satisfaction with the level of independence achieved by the RBI but underlined the need for more leeway, especially for regulating state-run banks where the RBI cannot effect any management changes, balance sheet management where fiscally pressured government eyes the surplus, and "regulatory scope" like its ongoing tussle on who manages the payments landscape with government.

To illustrate the achievements, he pointed out the inflation targeting framework and the setting up of the rate setting panel and introduction of bankruptcy laws.

He termed the RBI as a "friend" of the government, which will "tell the government unpleasant but brutally honest truths and correct, to the extent it can, any adverse long-term consequences of government policies".

Acharya cited global experience to point out that not maintaining independence of central banks has led to deep economic troubles as in Argentina in 2010 and also pointed out that issues faced by countries like Turkey have their roots in central bank's independence.

The basic difference between a central bank and a "myopic" government is of the time horizon for which decisions are made, he said, comparing central banks with cricket Test teams and the executive arms of the government as T-20 teams looking for quick results.

The speech comes amid a host of issues on which the RBI is reportedly sparring with the government.

It comes exactly a week after it decided to go public with its displeasure on who will regulate payment systems by posting a dissent note, and amid pressure from the government to relax the prompt corrective action (PCA) norms which restrict lenders' activities for having high levels of dud assets and depleting capital reserves.

"Sweeping bank loan losses under the rug by compromising supervisory and regulatory standards can create a facade of financial stability in the short run, but inevitably cause the fragile deck of cards to fall in a heap at some point in future, likely with a greater taxpayer bill and loss of potential output," he said, pointing to the over&nbsp; 
Rs 10.50 lakh crore NPAs the banking system is plagued with.

He also spoke about the scenarios which can compromise the central bank's independence such as appointment of government officials rather than technocrats to key positions such as governor, erosion of its powers through "piece-meal legislative amendments", blocking of rule-based central bank policies and setting up of parallel regulatory agencies.

Acharya concluded his speech asserting that "independent central bankers will remain undeterred", making clear the institutional resolve.&nbsp;

Pitching for "effective independence", RBI Deputy Governor Viral Acharya Friday said governments that do not respect central bank's independence would sooner or later incur the wrath of financial markets.

Pitching for "effective independence", RBI Deputy Governor Viral Acharya Friday said governments that do not respect central bank's independence would sooner or later incur the wrath of financial markets. Amid instances of apparent differences between the government and the RBI, Acharya emphasised that undermining a central bank's independence is akin to committing a "self goal" for any government. Wiser politicians will give a central bank necessary autonomy so that they reap electoral benefits of stable macroeconomic conditions which such independence will bring, Acharya said here. Delivering the AD Shroff Memorial Lecture, he said, "What matters is the effective independence with which these powers (vested in the Acts governing the RBI or any central bank) can be exercised in practice." "Governments that do not respect central bank's independence will sooner or later incur the wrath of financial markets, ignite economic fire and come to rue the day they undermined an important regulatory institution," Acharya said. Noting that markets have a keen eye on this aspect, he said that if uncertainty grows and confidence in central bank's independence and credibility erodes, "then markets rap bond yields and exchange rate on the knuckles!" "Wiser governments which accord the necessary leeway will benefit through lower costs of borrowing, the love of international investors and longer life spans," he said. In recent months, the RBI and the government have been apparently differing on approach to certain issues, such as those pertaining to payment systems regulator and Prompt Corrective Action (PAC) norms for banks. In his over 85-minute long speech, the academic-turned-central banker seemed to be expressing some satisfaction with the level of independence achieved by the RBI but underlined the need for more leeway, especially for regulating state-run banks where the RBI cannot effect any management changes, balance sheet management where fiscally pressured government eyes the surplus, and "regulatory scope" like its ongoing tussle on who manages the payments landscape with government. To illustrate the achievements, he pointed out the inflation targeting framework and the setting up of the rate setting panel and introduction of bankruptcy laws. He termed the RBI as a "friend" of the government, which will "tell the government unpleasant but brutally honest truths and correct, to the extent it can, any adverse long-term consequences of government policies". Acharya cited global experience to point out that not maintaining independence of central banks has led to deep economic troubles as in Argentina in 2010 and also pointed out that issues faced by countries like Turkey have their roots in central bank's independence. The basic difference between a central bank and a "myopic" government is of the time horizon for which decisions are made, he said, comparing central banks with cricket Test teams and the executive arms of the government as T-20 teams looking for quick results. The speech comes amid a host of issues on which the RBI is reportedly sparring with the government. It comes exactly a week after it decided to go public with its displeasure on who will regulate payment systems by posting a dissent note, and amid pressure from the government to relax the prompt corrective action (PCA) norms which restrict lenders' activities for having high levels of dud assets and depleting capital reserves. "Sweeping bank loan losses under the rug by compromising supervisory and regulatory standards can create a facade of financial stability in the short run, but inevitably cause the fragile deck of cards to fall in a heap at some point in future, likely with a greater taxpayer bill and loss of potential output," he said, pointing to the over Rs 10.50 lakh crore NPAs the banking system is plagued with. He also spoke about the scenarios which can compromise the central bank's independence such as appointment of government officials rather than technocrats to key positions such as governor, erosion of its powers through "piece-meal legislative amendments", blocking of rule-based central bank policies and setting up of parallel regulatory agencies. Acharya concluded his speech asserting that "independent central bankers will remain undeterred", making clear the institutional resolve.

A govt that does not respect RBI's independence will incur wrath of markets: RBI Deputy Governor

The soon to be Deputy Governor in the apex bank of India, Viral Acharya, who was picked from a total of 90 applicants, was a former C.V. Starr Professor of Economics at New York University Stern.

The 42 year old professor joined NYU Stern in 2008 and was also a former student of NYU Stern who completed his Ph.D in Finance from NYU Stern itself in 2001.

Acharya also has a Ph.D in Computer Science from New York University and a B Tech in Computer Science and Engineering from IIT Bombay.

Prior to joining NYU Stern, Acharya was a Professor of Finance and Academic Director of the Private Equity Institute at the London Business School, a Research Affiliate of the Center for Economic Policy Research and an Academic Advisor to the Bank of England.

He has published articles in the Journal of Finance, Journal of Financial Economics, Review of Financial Studies, Journal of Business, Rand Journal of Economics, Journal of Financial Intermediation, Journal of Money, Credit and Banking, and Financial Analysts Journal.

Professor Acharya has received numerous awards and recognition for his research.

He received the Best Paper Award in Corporate Finance from the Journal of Financial Economics in 2000, Best Paper Award in Equity Trading at the Western Finance Association Meetings in 2003, Outstanding Referee Award for the Review of Financial Studies in 2003, the inaugural Lawrence G. Goldberg Prize for the Best Ph.D. in Financial Intermediation, Best Paper Award in Asset Pricing from the Journal of Financial Economics in 2005, and an inaugural Rising Star in Finance Award in 2008.

The government said that Acharya will remain governor for a span of three years or until further notice.

The post fell vacant after elevation of Urjit Patel as the Governor of RBI in early September.

Subsequently for this post, the government said that it had received about 90 applications till October 21, the last date for sending applications.

(To read more, please visit <a href="http://www.zeebiz.com/">zeebiz.com</a>)

The soon to be Deputy Governor was picked from a total of 90 applicants

The soon to be Deputy Governor in the apex bank of India, Viral Acharya, who was picked from a total of 90 applicants, was a former C.V. Starr Professor of Economics at New York University Stern. The 42 year old professor joined NYU Stern in 2008 and was also a former student of NYU Stern who completed his Ph.D in Finance from NYU Stern itself in 2001. Acharya also has a Ph.D in Computer Science from New York University and a B Tech in Computer Science and Engineering from IIT Bombay. Prior to joining NYU Stern, Acharya was a Professor of Finance and Academic Director of the Private Equity Institute at the London Business School, a Research Affiliate of the Center for Economic Policy Research and an Academic Advisor to the Bank of England. He has published articles in the Journal of Finance, Journal of Financial Economics, Review of Financial Studies, Journal of Business, Rand Journal of Economics, Journal of Financial Intermediation, Journal of Money, Credit and Banking, and Financial Analysts Journal. Professor Acharya has received numerous awards and recognition for his research. He received the Best Paper Award in Corporate Finance from the Journal of Financial Economics in 2000, Best Paper Award in Equity Trading at the Western Finance Association Meetings in 2003, Outstanding Referee Award for the Review of Financial Studies in 2003, the inaugural Lawrence G. Goldberg Prize for the Best Ph.D. in Financial Intermediation, Best Paper Award in Asset Pricing from the Journal of Financial Economics in 2005, and an inaugural Rising Star in Finance Award in 2008. The government said that Acharya will remain governor for a span of three years or until further notice. The post fell vacant after elevation of Urjit Patel as the Governor of RBI in early September. Subsequently for this post, the government said that it had received about 90 applications till October 21, the last date for sending applications. (To read more, please visit zeebiz.com)

Who is Viral Acharya?

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