Rajan begins his innings with big-bang reforms

Reserve Bank of India’s new Governor Raghuram Rajan has started off with big-bang reforms. Driving optimism in his first speech, Rajan said that RBI has proposed a bunch of reforms which he has every intention to implement.

“I think there are so many low-hanging fruits in the economy that if we only pluck them, we can accelerate growth substantially. Also, there are some positive developments in the economy going forward which will also help, for example the monsoon, but I think we need not sit still.” Postponing the mid-quarter monetary policy to September 20 from September 17 earlier, Rajan said the Fed’s announcement is important but it is not the only international development. But the central bank will monitor all developments including domestic while making the policy. 

Amid the recent downgrade threat by rating agencies, the former government man said, “As far as I understand, S&P has nearly reiterated its previous stand. That is something to do with what we are and not new. I wouldn’t read too much into that statement.” He said: “We have to be careful about not injecting, more uncertainty in the economy than it can handle. So we have to handle it in a measured way.”

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