A former student of history and known for his sharp financial acumen, there’s more than meets the eye when it comes to the new RBI governor – Shaktikanta Das. Let’s find out more.
Minds were boggled when a former student of history was chosen to head the RBI in December. Heading the central banking institution and regulator of one of the world’s fastest growing economies is no mean task since it entails carving out policies and deciding rates that affect all financial products like Fixed Deposits, Public Provident Fund etc. that are availed by citizens in our country of 1.2 billion people.
Shaktikanta Das, the man who served as the secretary in the Department of Economic Affairs during the demonetisation drive in 2016, was appointed in December as the 25th governor of the Reserve Bank of India to succeed Urjit Patel. Let’s get to know him better, shall we?
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Early life and education:
Mr. Das was born and schooled in Bhubaneswar and went on to obtain his bachelor’s (BA) and master’s degrees (MA) in history from St. Stephen’s College, Delhi. While he was an IAS officer, he underwent several mid-career training courses in finance from IIM Bangalore, IIM Calcutta, National Institute of Bank Management, Administrative Staff College etc. that would prepare him to take on roles demanding sharp financial acumen later in life.
An IAS officer from Odisha, Mr. Das served in various capacities for the Indian and Tamil Nadu governments. Some of the positions he held included that of Principal Secretary for Industries, Special Commissioner for Revenue, Project Director of Tamil Nadu State AIDS Control Society and as the District Magistrate and Collector of Dindigul and Kancheepuram districts in the Tamil Nadu government.
In his first bureaucratic shuffle, Mr. Das, then the Fertilizer Secretary, was appointed as the Revenue Secretary. He was in-charge of the first budget presented by the Modi government. During his tenure as Union Economic Affairs Secretary, Mr. Das was regarded as one of the most powerful civil servants in India.
Post his retirement from the IAS, he was appointed as a member of the Fifteenth Finance Commission, and thereafter as India’s Sherpa to the G20. On his appointment as the RBI governor in 2018, he resigned from his position in the Fifteenth Finance Commission.
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What do others say about his appointment as RBI governor?
Mr. Das’ appointment was met with a lot of encouragement and praise from corporate luminaries across the board:
S.S. Mundra, Former Deputy Governor, Reserve Bank of India
“Whatever has happened, I think it was very important to not allow a void to continue. With that perspective, I think he is a good and balanced choice. He is seasoned and has a good understanding of the whole of the financial sector, both from the ministry and also in his interactions with the RBI.
I believe he can engage with all the stakeholders because to my mind, many of the current issues and situations have come also because of a large gap in communication, which I am sure Mr. Das, with his experience and past engagement, would be able to fill in.
At the moment there are several issues which are on the table. What would be most important would be to open the line of communication and engagement.”
V K Vijaykumar, Chief Investment Strategist at Geojit Financial Services
“The government should be complimented for deciding on Urjit Patel’s successor so quickly. Now it is up to Mr. Shaktikanta Das to prove his credentials. Officers like Subbarao and YV Reddy have proved themselves as great RBI governors who refused to toe the government’s line.
Shaktikanta Das with his rich experience in finance and economic management and expertise in team management has the competence to heal the wounds that have risen from the friction between the central bank and the government.”
Madhavi Arora, Economist, Edelweiss Securities, Mumbai
“Shaktikanta’s appointment is likely to cheer bond and FX markets as we may possibly see better communication between the government and the central bank amid the current rift on variety of issues.
Markets will watch for the meeting of the Central Board of the RBI on December 14 (unless rescheduled) to get some cues on Das’ take on conflicting issues between the government and the RBI on PCA framework, NBFC liquidity stress and RBI’s capital.”
With considerable experience in working for the government across roles, Mr. Das has a good understanding of the inner workings of the government and an insight into what it would require. Industry and market leaders are looking at Mr. Das to ease the tension that now exists between the government and the central bank and reinstate the financial markets’ faith in the central bank’s ability to steer the country’s economy. Das joins the RBI at a crucial juncture, since in a couple of months the country will be heading for elections and questions are being raised about the central bank’s operational freedom.
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