BJP MP Subramanian Swamy wants to kick out Reserve Bank Governor Raghuram Rajan “effective immediately or when his term ends.” And for this he has written a letter to PM Modi.
Swamy has accused Rajan of “wilfully” wrecking the economy. He also said that the RBI governor is “mentally not fully Indian” as he continues to renew the Green Card issued to him by the US government.
According to Swamy, Rajan was “not appropriate for the country” as he had in the garb of controlling inflation raised interest rates leading to “collapse of industry and rise of unemployment in the economy.”
He has also pointed out that bad loans with public sector banks has doubled to Rs 3.5 lakh crore in two years.
Rajan was appointed RBI Governor by the previous UPA government in September 2013 for a three-year term, which can be extended.
After assuming charge as RBI governor in September 2013, Rajan gradually raised the short-term lending rate from 7.25 per cent to 8 per cent and had retained the high rates throughout 2014. He kept the rates high, citing inflationary concerns despite intense pressure from the Finance Ministry and the industry for softening them with a view to boosting growth.
He said these actions of Rajan shows lead him to believe that he is acting more as a disrupter of the Indian economy rather than improving it.
Earlier, he had given the example of hypermarkets chain Wal-Mart, which he said, is “trying hard to come to India”, and when it does that there “will not be a level-playing field” because of Rajan.
“Because Walmart gets capital in their own country at two percent interest rate. And then they come to India… and in India, the competitor trader he gets, thanks to Raghuram Rajan, 12 per cent interest rates and in the informal market 25 per cent interest rate. How can you compete?” he questioned.