MUMBAI: India\u2019s outgoing central bank chief insisted he had laid the foundations for sustainable growth in the world\u2019s best-performing major economy after keeping interest rates on hold in his final policy review on Wednesday.
\nRaghuram Rajan, who caught the government off guard in June by announcing he was stepping down in September, said he was unfazed by his critics and that the only thing that mattered was the impact of his decisions.
\nThe Reserve Bank of India (RBI) governor was speaking to reporters after announcing the outcome of the last monthly policy review before he returns to academia next month.
\nAfter confirming that he was keeping rates on hold to check inflation, Rajan staunchly defended his time in office during which he has faced severe criticism from allies of Prime Minister Narendra Modi.
\n\u201cI think snap judgements either by critics or by supporters aren\u2019t really what matters,\u201d Rajan, who is a former International Monetary Fund (IMF) chief economist, told reporters in Mumbai.
\n\u201cWhat matters is how this plays out in the longer run for stronger and sustainable growth for the country, for job creation, for our movement into the middle income. In our view, the measures we have taken in the RBI were and are justified given the conditions that we have. People can have different judgements.\u201d
\nSince Rajan\u2019s appointment in 2013 under the previous centre-left government, India has enjoyed growth rates that have eclipsed other major economie. India\u2019s economy expanded by 7.9 per cent in the fourth quarter of 2015-16, the fastest of any major economy, while inflation has fallen from double-digit levels to under sixpc on his watch.
\nBut although interest rates are at their lowest level since 2011, there have been tensions with the ruling Bharatiya Janata Party (BJP) which has been pushing for deeper cuts, saying these would boost growth further.
\nThe BJP lawmaker Subramanian Swamy called Rajan an idiot earlier this year and told him to \u201cgo back to Chicago\u201d where he used to be a finance professor.
\nMost economists however have lamented the prospect of the departure of the man who famously predicted the 2008 global financial crisis.
\nRajan had been widely expected to hold the benchmark repo rate — the level at which it lends to commercial banks — at 6.50pc on Wednesday. The bank last cut rates by 25 basis points in April.
\n\u2018HAWKISH APPROACH\u2019: In his address to the media, Rajan said he was confident there would be further falls in inflation after the level inched upwards to 5.77pc in June, but warned that risks remained.
\n\u201cUntil we see the full effects of the monsoon, it would be premature to declare victory,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"
MUMBAI: India\u2019s outgoing central bank chief insisted he had laid the foundations for sustainable growth in the world\u2019s best-performing major economy after keeping interest rates on hold in his final policy review on Wednesday. Raghuram Rajan, who caught the government off guard in June by announcing he was stepping down in September, said he was […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-1049","post","type-post","status-publish","format-standard","category-business"],"yoast_head":"\n