Meaningless comparison among the RBI Governors since 1990.

The comparison among Governors’ is meaningless as the performance is linked to the political climate and support in the Governance system, sound economic policies and conducive external sector environment. All these are found missing during the last five years when Dr Subbarao took over in the year 2008.The present RBI Governor's period is some thing unique in the history of RBI. He took charge when there was global financial turmoil and he had to ensure that Indian Financial system and the economy escaped unhurt because of the crisis. Subsequently, he had the misfortune of fighting both inflation and growth without the support of the Govt and the fiscal policy measures. Not only he failed to get the support but also had to face the displeasure of the Govt in not yielding to its pressures to dance to its tunes. He had to face the humiliation when the Govt set up the FSDC and made the RBI as any other institution like SEBI and IRDA without having any supremacy which as a Central bank of the Country it is entitled to. Adding insult to injury, the Government started giving directions to banks directly bypassing RBI. This gave the banks an upper hand and they gave the impression that they cared for more the Govt than the RBI. The SBI the biggest commercial bank instead of giving full support to RBI to ensure success of its monetary policies opposed RBI's every move to curry favour from the Government.The banking system failed both RBI and the Govt leading to such a pathetic condition of the economy.The banks tried to undercut both and landed themselves in liquidity crisis bringing down deposits, adding to NPAs and creating unprecedented mismatch between assets and liabilities. SBI chief has been against RBI policies and has been some sort of indirect support to other banks in challenging RBI measures. The result is the Govt suffers, the economy suffers, the banking system suffers and RBI has to tackle everything together. But the Governor will prove to be right in his thinking and actions if the Govt and the banks dare to introspect as to what they have done to RBI during the last three years in particular and realise their follies..Governor can keep his head high for his boldness and the challenges he faced to maintain the Reserve Bank's importance and supremacy without yielding to the pressures of the Govt and without having the normal cooperation and support of the banking system.Subba Rao's era will have some special place in RBI and Indian Economy's history for the challenges he faced both from the Govt and the banks. The economists will reailse the important role played by RBI during the most inactive performance of the Govt when they introspect in leisure. The Comparison should have been on the political leadership the economy had since 1990 to get an appropriate and logical conclusion.

 Dr.T.V.Gopalakrishnan 

 This comment is in response to a news report Has RBI Governor Subbarao delivered that appeared in Business Standard dated 27/7/13).