Govt hopes Patel will 'rise to occasion'

 The government on Monday hoped that RBI Governor-designate Urjit Patel will “rise to the occasion” and use his experience of handling monetary policy at the central bank to maintain a balance between inflation and economic growth.

Patel, who is currently a Deputy Governor at the Reserve Bank of India (RBI), will take over the top job at the central bank, when incumbent Raghuram Rajan demits office on September 4 after completing his term.

“He (Patel) will hopefully control the inflation rate since he has experience of monetary policy,” Minister of State for Finance Arjun Ram Meghwal told reporters.

He further said, “Patel’s appointment is a right decision and in the interest of the country.” Economic Affairs Secretary Shaktikanta Das, who himself was said to be in the fray for the top post at the apex bank, welcomed the appointment of Patel as the 24th RBI Governor.

“With his background in monetary economics, monetary policies and his background in other fields, I am sure he will rise to the occasion and will keep in mind the requirements of monetary policy and the inflation target that has now been laid out in the RBI Act,” he said.

The government has set an inflation target of 4%, plus or minus 2%, while consumer price inflation soared to 6.07% in July.

“He will also balance the requirement of growth which is in fact the mandate as per the amended RBI Act,” Das said.

Stating that the job of the RBI governor is not just monetary policy, Das said the central bank head is also the regulator of banks and NBFCs.

“In that role, he has to ensure smooth functioning of the financial sector, and he also has to look into the flow of credit to various sectors in particular the requirement of agriculture and MSME sectors,” he said.