Urjit Patel’s resignation ‘severe blow to nation’s economy’: Manmohan Singh

“There have been apprehensions expressed earlier by the Deputy Governor of the RBI about the government’s intent to raid the capital reserves of the RBI for fiscal purposes. I hope the resignation of the Governor is not a sign that this may soon become a reality,” Singh, who served as finance minister from 1991-1996 said.

Taking a jibe at the Narendra Modi government, which has been at loggerheads with the RBI for the past several months, the eminent economist said, “Building institutions take a long time and effort but they can be destroyed in a whimper. It is institutions such as the RBI, among many others that have served as the edifice of our great nation’s progress since independence. It will be foolhardy to diminish these institutions for short-term political gains.”

“I also sincerely hope that this sudden resignation of the Governor is not a harbinger of the Modi government’s attempts to destroy the institutional foundations of India’s $3 trillion economy,” he added.

Full text of Manmohan Singh’s letter

It is with great sadness that I received the news of the resignation of the Governor of the Reserve Bank of India, Dr. Urjit Patel.

I have known Dr.Patel to be an economist of high repute and also someone who cared deeply about India’s financial institutions and economic policy. Dr.Patel’s sudden resignation, at a time when the Indian economy is faced with many headwinds is very unfortunate and is a severe blow to the nation’s economy.

There have been apprehensions expressed earlier by the Deputy Governor of the RBI about the government’s intent to raid the capital reserves of the RBI for fiscal purposes. I hope the resignation of the Governor is not a sign that this may soon become a reality.

Building institutions take a long time and effort but they can be destroyed in a whimper. It is institutions such as the RBI, among many others that have served as the edifice of our great nation’s progress since independence. It will be foolhardy to diminish these institutions for short-term political gains.

I wish Dr. Urjit Patel success in his future endeavours. I also sincerely hope that this sudden resignation of the Governor is not a harbinger of the Modi government’s attempts to destroy the institutional foundations of India’s $3 trillion economy.