Former Reserve Bank of India Governor Raghuram Rajan has said that the job of a central banker has become much more political in recent times. Rajan made the remark in an interview with the BBC while denying that he had applied for the governor’s post at the Bank of England.
In April 2018, the Financial Times had reported that Rajan was a top contender for the post. Rajan, however, refuted the report, saying he had a good job at the University of Chicago and that he was an academic, rather than a professional central banker. Rajan is presently the Katherine Dusak Miller Distinguished Service professor of finance at the University of Chicago Booth School of Business.
In an interview on BBC’s HardTalk, when asked about the governor’s post at the Bank of England, Rajan said he was “perfectly happy” in his job. “And that’s not a diplomatic statement, it’s actually the truth,” he said. “I’m perfectly happy and I haven’t applied for any job.” A clip of the interview was published on Friday and the full interview will be aired on Monday.
Asked if he was approached to apply for the job, Rajan said: “I haven’t applied.” When pressed further, Rajan said: “I really believe that the central banker’s job has become much more political in recent times. For that it’s best a country have somebody who understands the political structure within that country and how to navigate that. And so it seems to me that’s something that people have to take into account when they determine who they want as central bank governor.”
Rajan was the governor of the Reserve Bank of India from 2013 to 2016. United Kingdom Chancellor Phillip Hammond will select the next governor of the Bank of England, one of the world’s largest central banks, to replace Mark Carney this year.
When the interviewer asked if he would be able to understand the politics of the United Kingdom and the challenge of Brexit, Rajan said: “It’s obvious that I’m an outsider and I have very little understanding of the deep ebbs and flows of politics in this country.”