Bimal Jalan gets two-year extension

The Reserve Bank of India RBI Governor Bimal Jalan has got a two-year extension as the RBI chief. Jalan8217;s original term gets over in October.

According to sources, among the names cleared for the post of deputy governor of RBI, former advisor to the finance minister Rakesh Mohan heads the list. He is expected to come in place of Y. V. Reddy who is scheduled to go to IMF as one the Indian representatives.

Sources said that the government wanted the apex bank to continue with its present trend of tight monetary policy on one hand and a indicative credit policy on the other. Jalan was instrumental in breaking away from the traditional stress of RBI on interest rates in its credit policy. At present the RBI has shifted to an indicative credit policy by which it does not tinker much with the rates but gives an indication for the interest rates. Jalan extension is aimed at ensuring that the RBI continues with its present policy.