"I do what I do". A remark made in passing by former Reserve Bank of India governor Raghuram Rajan at a monetary policy conference a couple of years ago went on to grab headlines across newspapers and news websites.
Encouraged by his wife, Rajan has now used that catchphrase as the title of his new book in which he talks about reforms, rhetoric and resolve through a compilation of his speeches delivered while at the helm of the central bank. Rajan launched the book at an event in Chennai on Tuesday evening, in which he addressing topics ranging from demonetisation to bad loans.
Here are the key takeaways:
> The book begins with how Rajan tackled the crisis in 2013 – Depreciating rupee, high inflation and high current account deficit and India considered among the Fragile Five (economies).
> The book is structured on five pillars being focused on at RBI – Inflation control, reforming the banking system and making it competitive, improving resilience of the markets, financial inclusion and dealing with distress in the system.
> Rajan said the least progress has been made on cleaning up the banking system and dealing with stress while most progress made on inflation focus that helped stabilise the rupee and external side of the system.
> The former RBI governor said that there had been enormous pressure to stick to timelines at the central bank.
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> Rajan said he had spoken out on demonetisation in the book as responses given to Parliamentary Committee (by RBI) "weren't in accordance to my actual response". He added that Parliament has a right to know what actually happened on the issue.
> Rajan said he had given his RBI successor Urjit Patel a small memento in the form of a symbol of a rupee, at the bottom of which read “humari zimmadari” (our responsibility) reflecting a central bank’s biggest role which is to stabilise the value of the rupee.
Here are some of the other notable quotes from the launch:
> Shadow of Insolvency and Bankruptcy code makes bank re-negotiation much easier. During my time, we worked without that shadow. Still an issue needs to be resolved that every loss taken will not be met by enquiry from investigative agencies.
> Better to merge banks when they are healthy, bring in the management capacity and then contemplate mergers.
> Not clear on the demand for cryptocurrencies. I am a little skeptical about the valuations of these currencies.
> Against making RBI completely independent. RBI cannot work in contrapurpose with the government but in certain functions such as regulation, supervision and on monetary policy we should make sure we don’t compromise.
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