The Congress on Monday lashed out at the Centre after Business Standard reported that Reserve Bank of India Deputy Governor Viral Acharya has resigned from the central bank six months before his term was scheduled to end. Acharya, the central bank’s youngest deputy governor since economic liberalisation, said he had resigned because of “unavoidable personal reasons”.
“Government changes, but issues of economic manhandling remain!” tweeted Congress spokesperson Randeep Singh Surjewala. “RBI Deputy Governor Viral Acharya adds his name to the long list of experts who attempted to show the ‘mirror of truth’ to BJP regime. Four economic advisors, two RBI governors and a NITI Aayog vice-chairperson have resigned earlier!”
Arvind Subramanian quit as chief economic advisor in June 2018, while Surjit Bhalla resigned from the Economic Advisory Council to the Prime Minister six months later. Reserve Bank of India Governor Urjit Patel also resigned the same month. His predecessor Raghuram Rajan had quit in September 2016.
NITI Aayog Vice Chairperson Arvind Panagariya stepped down from his position in August 2017. Earlier this year, two independent members of the National Statistical Commission resigned after the Bharatiya Janata Party-led Central government failed to publish a report on employment that was readied in December. The report was released last month.
Former Congress leader and political commentator Tehseen Poonawalla said the country should get ready for tough times. “As Viral Acharya quits the RBI and for the first time since Independence, Central government salaries have been delayed, India must brace herself for 2 things: 1) A collapsing economy, 2) lots more of hate, communal polarisation, mob violence and bigotry to divert attention.”
Aam Aadmi Party leader Preeti Sharma Menon posted a sarcastic tweet. “It is good Viral Acharya quit,” she said. “We do not need economists. History majors are best suited to head our central bank.”
This was an apparent reference to Shaktikanta Das, who was appointed the governor of the Reserve Bank of India in December 2018. He was the first in decades to hold the post without having been an economist. He has a degree in history.
Acharya’s resignation has been speculated upon in banking circles since former RBI Governor Urjit Patel quit the bank on December 10. According to the RBI Act, the central bank can have four deputy governors. One of the posts is usually for an economist, who is in charge of monetary policy. Before Acharya, Urjit Patel held the position. Patel’s predecessors were Subir Gokarn, Rakesh Mohan, and YV Reddy.
Though Acharya was tasked with leading the central bank’s monetary policymaking, his primary focus was the banking crisis till Urjit Patel resigned.
Last October, he created a storm when he made remarks that were indicative of differences between the central bank and the Union finance ministry. He had warned that undermining a central bank’s independence could be “potentially catastrophic”, and said governments that do not respect it sooner or later incur the wrath of financial markets.
Acharya joined the Reserve Bank of India on January 23, 2017, for a three-year term. He is now expected to return to New York University Stern School of Business in August as the CV Starr Professor of Economics.