RBI deputy governor:RBI deputy governor, Viral Acharya resigns, regulator in consideration for approval

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Ambuj Tripathi


New Delhi, Jun.24: Reserve Bank of India (RBI) deputy governor Viral Acharya has tendered his resignation six months before his tenure to end. Acharya is to return to New York University Stern School of Business (NYU Stern) in August instead of February 2020. While RBI is yet to issue an official statement confirming the same, inside sources in RBI and also in finance ministry confirmed his resignation.

As per information posted on RBI website, GM Yogesh Dayal said, ‘Reports have appeared in certain sections of the media that Dr. Viral V. Acharya, Deputy Governor of the Reserve Bank of India (RBI) has resigned from his post. In this connection it is stated as follows. A few weeks ago, Dr. Acharya submitted a letter to the RBI informing that due to unavoidable personal circumstances, he is unable to continue his term as a Deputy Governor of the RBI beyond July 23, 2019. Consequential action arising from his letter is under consideration of the Competent Authority’.

Acharya was, actually, appointed as the RBI deputy governor by government on January 23, 2017 for a three-year term. He had raised concern over the importance of RBI’s independence in October 2018. Even, the RBI and government had been on crossroad on over various issues, especially on decisions pertaining to use of RBI’s excess reserves. The RBI under former governor Urjit Patel was reluctant in releasing excess funds–something that the government had pitched in the middle of a liquidity crisis due to a collapse of the shadow-banking or non-banking financial companies (NBFC) sector. Urjit Patel and Viral Acharya were not in agreement with the government for its alleged intervention into key decision-making of the RBI. Due to this Patel resigned from his post. He had expressed his opinion in open that the government was trying to dilute the central bank’s policies and warned about the result. 

Acharya’s resignation may be the reason of differences between the bank regulator and central government still in existence. Even after Urjit Patel’s exit, Acharya continued to strongly voice his differences with new RBI governor Shkatikanta Das over slow growth and inflation. Meanwhile, a finance ministry source confirming Acharya resignation said that they were already apprised of the fact that he would resign.