Andy Mukherjee
Rajan's call to diaspora can't stem rupee rout, says Andy Mukherjee.
Raghuram Rajan's first move as India's monetary czar has been to solemnise a marriage between a needy country and its greedy diaspora. That's the easy part.
Tackling the gruelling Indian stagflation will be the real test for the former International Monetary Fund chief economist.
Rajan, who presciently warned developed nations about a risky buildup of leverage in 2005, began his career as a central banker in Mumbai on September 4 by reaching out for the low-hanging fruit: the monetary authority, he said, will charge local lenders a fixed 3.5 per cent annual fee to convert new long-term dollar deposits from expat Indians into rupees.
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Raghuram Rajan's first move as India's monetary czar has been to solemnise a marriage between a needy country and its greedy diaspora. That's the easy part.
Tackling the gruelling Indian stagflation will be the real test for the former International Monetary Fund chief economist.
Rajan, who presciently warned developed nations about a risky buildup of leverage in 2005, began his career as a central banker in Mumbai on September 4 by reaching out for the low-hanging fruit: the monetary authority, he said, will charge local lenders a fixed 3.5 per cent annual fee to convert new long-term dollar deposits from expat Indians into rupees.
Click NEXT to read more...
Image: Raghuram Rajan (L), newly appointed governor of Reserve Bank of India (RBI), hugs the outgoing governor Duvvuri Subbarao during the taking over ceremony at the bank's headquarters in Mumbai.