<div>Modi government promoted Urjit Patel, a deputy governor in charge of monetary policy at the Reserve Bank of India, to serve as its next governor for a three-year term, it said on Saturday.<br /><br />He will replace Raghuram Rajan, a former International Monetary Fund chief economist who stunned financial markets in June by announcing he would step down in September and return to academia after a single three-year term at the RBI.<br /><br />Patel, 52, headed a panel that recommended landmark changes to monetary policy in India, including a switch to inflation-targeting and the creation of a panel to set interest rates. He will start his three-year term on Sept. 4.<br /><br />"The Appointments Committee of Cabinet has approved the appointment of Dr. Urjit R. Patel as Governor, Reserve Bank of India for a period of three years," said the statement from the government.<br /><br />Patel, who has a doctorate from Yale, had widely been seen as ensuring the most continuity among the candidates believed to be in the running to be the next governor.<br /><br />He had been reappointed in January for another three years as deputy governor in charge of monetary policy, a department he has run since 2013.<br /><br />Seen as a close lieutenant to Rajan, Patel will now get to implement the policies he had helped shape.<br /><br />The government is soon expected to announce the composition of a six-member monetary policy committee to decide on interest rates. It will be made up of himself and two other RBI officials, along with three members appointed by the government.<br /><br />Rajan, who succeeded in halving the inflation rate from the double digit levels prevailing when he took over, also persuaded the government to adopt inflation targeting, setting a medium term central target of 4 percent, within a range of 2 to 6 percent - another policy endorsed by Patel.<br /><br /><br />The new governor takes over at a time when inflation has bust out of the top end of that range. Consumer inflation INCPIY=ECI accelerated to 6.07 percent in July, the fourth consecutive month it has stayed above the RBI's near-term target of 5 percent by March.<br /><br />Aside from controlling inflation, the new governor will have to follow through on efforts to clean-up banks' bad loans so that they can once again support the investments needed if India is to keep its place as one of the world's fastest growing economies.<br /><br />Patel will also have to navigate India's tricky political scene. Right-wing members of the ruling Bharatiya Janata Party (BJP) had criticized Rajan for some of his speeches on economic matters and for not cutting interest rates faster.<br /><br /></div>
<div>Modi government promoted Urjit Patel, a deputy governor in charge of monetary policy at the Reserve Bank of India, to serve as its next governor for a three-year term, it said on Saturday.<br /><br />He will replace Raghuram Rajan, a former International Monetary Fund chief economist who stunned financial markets in June by announcing he would step down in September and return to academia after a single three-year term at the RBI.<br /><br />Patel, 52, headed a panel that recommended landmark changes to monetary policy in India, including a switch to inflation-targeting and the creation of a panel to set interest rates. He will start his three-year term on Sept. 4.<br /><br />"The Appointments Committee of Cabinet has approved the appointment of Dr. Urjit R. Patel as Governor, Reserve Bank of India for a period of three years," said the statement from the government.<br /><br />Patel, who has a doctorate from Yale, had widely been seen as ensuring the most continuity among the candidates believed to be in the running to be the next governor.<br /><br />He had been reappointed in January for another three years as deputy governor in charge of monetary policy, a department he has run since 2013.<br /><br />Seen as a close lieutenant to Rajan, Patel will now get to implement the policies he had helped shape.<br /><br />The government is soon expected to announce the composition of a six-member monetary policy committee to decide on interest rates. It will be made up of himself and two other RBI officials, along with three members appointed by the government.<br /><br />Rajan, who succeeded in halving the inflation rate from the double digit levels prevailing when he took over, also persuaded the government to adopt inflation targeting, setting a medium term central target of 4 percent, within a range of 2 to 6 percent - another policy endorsed by Patel.<br /><br /><br />The new governor takes over at a time when inflation has bust out of the top end of that range. Consumer inflation INCPIY=ECI accelerated to 6.07 percent in July, the fourth consecutive month it has stayed above the RBI's near-term target of 5 percent by March.<br /><br />Aside from controlling inflation, the new governor will have to follow through on efforts to clean-up banks' bad loans so that they can once again support the investments needed if India is to keep its place as one of the world's fastest growing economies.<br /><br />Patel will also have to navigate India's tricky political scene. Right-wing members of the ruling Bharatiya Janata Party (BJP) had criticized Rajan for some of his speeches on economic matters and for not cutting interest rates faster.<br /><br /></div>