The government has shortlisted four candidates to become the next governor of the Reserve Bank of India, a senior government official said. The official also said that a new Monetary Policy Committee will be chosen.
The chosen four include current RBI Deputy Governor Urjit Patel, former deputy governors Rakesh Mohan and Subir Gokarn and State Bank of India Chair Arundhati Bhattacharya. Another official from the Prime Minister's Office said that Rajan was expected to join the search committee to appoint three external members of the new Committee. The aim is to ensure the committee is constituted before the appointment of Rajan's successor, both the officials said. The three external members would be chosen by a search committee comprising Modi's cabinet secretary, the RBI governor, the secretary of the finance ministry's department of economic affairs and three outside experts chosen by the government.
Failure of negotiation for a second term has sparked fears that Rajan's departure could put the inflation-targeting central banker's gains in stabilising Asia's third-largest economy over the past three years. "We are very hopeful that the present governor will be a member of this search committee," one of the officials said, also adding that if all goes well, the new panel would be formed by August 1. If the schedule is held, the MPC would be in place for the last bi-monthly policy meeting that Rajan is expected to chair in early August.
