RBI Governor D Subbarao demits office on
September 4, after being at the helm for five years that saw the
beginning of the global recession from which it is yet to recover.
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Mumbai, Sept 2:
Top bankers have hailed the contributions of the outgoing Reserve Bank
Governor Duvuuri Subbarao saying he did his best during a tenure that
was marked by difficult times for the economy.
“I think the Governor’s (five year) term has been in one of the most difficult environments globally and domestically.
“If you look at the world and our country today, there is so much change
that you have to be at your feet and I can’t imagine anybody else doing
a better job (than Subbarao),” Axis Bank Managing Director and Chief
Executive Shikha Sharma said.
Subbarao demits office on September 4, after being at the helm for five
years that saw the beginning of the global recession from which it is
yet to recover.
Within a fortnight of him assuming office, global investment bank Lehman
Brothers filed for bankruptcy and the hit pulled the global banking
system down to an unprecedented credit crisis which eventually led to
the worst recession since the Great Depression.
This was followed by a difficult period which saw RBI working in close
coordination with the government and other financial sector regulators,
as also other central banks, to ring-fence the economy.
While the fiscal and monetary stimuli ensured that the economy did not
fall off cliff, this soon gave way to a spike in inflation. This saw
rise in policy rates from October 2010 for a year or so even as growth
started coming down.
As Subbarao’s term moved close to ending, worries over slowing growth
and stubborn inflation complicated the matter for the central bank. His
problems got compounded with the fall of the rupee beginning May-end. It
declined to a low of 68.85 intra-day to the dollar early last week.
“I’ve the highest respect for him. He has been through difficult times
and let’s put it this way: in hindsight, it’s very easy to judge
anybody...I do believe he did a great job,” Aditya Puri, who heads the
second largest private lender HDFC Bank, said.
“One thing that has not been fully talked about during his tenure is
that he has reduced CRR and SLR by 4 percentage points, which to my
mind, in a tenure of five years is very significant,” said Pratip
Chaudhuri, the chairman of the country’s largest bank State Bank of
India.
Chaudhuri, who favoured doing away with CRR, added that its reduction
was one of the reasons for the economic buoyancy during early part of
Subbarao’s stint.
“To some extent, the buoyancy which we saw in the economy in the
previous two years, could be attributed to that,” Chaudhuri said