Deans wrote:jpremnath wrote:i dont understand how is it the role of the CEA to tackle the NPA problem...his role is to advice the government on broader economic issues. Poring over balance sheets of banks was for the then RBI governor's job...even if it was his job, how do we know he hadn't flagged these issues to FM then?..
I mean, he did what was the right thing to do when he became RBI governor; he told the banks to stop kicking the NPA can down the road and get their shit together. The banks would have just glossed over these crony capitalist loans to essars, ambanis ,adanis et al for decades if they had a choice.
The CEA does not have to tackle NPA's, but he is expected to flag it if they present a risk to the economy - which they did. He does not claim
to have done so, in is interviews. I think we can all agree that NPA's arose in the UPA regime, due largely to crony capitalism. RR could well have commented on this but chose not to.
Even as RBI Gov, when he asked the banks to come clean on NPA's, he prevailed on the SC, not to `name and shame' the defaulters. As a result
at least a year was lost in acting against them by invoking the bankruptcy code.
Hence, the comments on NDA, mostly on matters outside his purview, were inappropriate, even if he felt the need to comment more on govt functioning, than any of his predecessors.
A central banker, when his views on a major govt policy (like DeMo)are solicited, is expected to be conservative and be a `devil's advocate',
pointing out all possible risks. That has been hyped by the media as `Rajan warned that Demo would be a disaster etc'. If RR really felt that
the policy was completely wrong, he could have resigned earlier - which would have truly given him the high moral ground and made him the
darling of the Cong/Liberal/Western crowd. His only actual criticism AFAIK, was that there would be a short term disruption and the
benefits are unknown, both of which are factually correct.
He did not claim to have flagged the NPA's because no one ever asked him if he did.Everyone here is constructing a narrative which they hope pin the entire economic malaise from NPAs on the only person who actually did something to tackle it. I dont see anyone ask what where the RBI governors before him did to check the NPA problem because the real reason why everyone is out for his blood is only because he made political statements while he was the governor(he should have been more careful in his position when talking to the media, i agree) and not for his actions as CEA(he was CEA only for 13 months).
And as far as i remember reading, it was the law ministry or the finance ministry which made that submission about defaulters in SC. But I stand ready to be corrected, but that was what i recall from then. There are elements in govt(babus and politicos) which sees things in grey when it comes to the defaulters. Did RR help mallya escape to london when he was under neck deep in trouble.? Do you think the intel agencies did not warn the govt of his chances of fleeing the country with the kind of diplomatic facilities he has??...You can claim no one in the Govt had a clue..but as everyone claim maybe it was the job of the then CEA to worry about it..Now we see all the tamasha in London courts where we are spending millions to supposedly 'bring him back'. This could have been avoided and no one realise how it makes our entire system look bad.
I am in no way trying to blame the govt for doing what they did when it comes to RR. They did what they had to do and what they are entitled to do as the captain of the ship. All i wanted to say is that It is not fair to try to demean a man who i feel was the right person at the right time who had all the ability and the best of intentions to do that job. RR and Govt has moved on and his 'short term' is the least of all our worries. BR is a forum where people come to discuss facts and reason and not emotion and hearsay, and i really hope we can all move on and discuss the real serious issues of our economy and its future in this radically changed circumstances which is what this thread is all about.
P.S: If people still want to diss RR, i suggest someone start and a thread named "How Raghuram Rajan single handedly derailed the economy"