Panagariya also in race for RBI chief's post

Govt has made it clear that it would prefer an economist to take over the top job in India's central bank

Niti Aayog Vice-Chairman Arvind Panagariya has also  emerged as a contender to take over as the 24th governor of the Reserve Bank of India, just a day before the government’s expected official announcement on the matter.

Prime Minister Narendra Modi will return from his five-day, four-nation tour of Africa on Tuesday morning and an announcement on Raghuram Rajan’s successor at Mint Road will likely be made later in the day, Business Standard has learnt from senior government sources.

“He (Panagariya) is well liked and comes with highly respected credentials. He is a contender for sure,” said a senior official. The official said an announcement is imminent, since the prime minister will be back in New Delhi on Tuesday morning.

The government has made it clear that it would prefer an economist to take over from Rajan, which could make the case for Panagariya even stronger.

Panagariya had not figured in the shortlist of four-five names spoken of by top sources in the immediate aftermath of Rajan’s announcement last month of his departure from the RBI at the end of his term.

Top government sources had said that the people in contention included former RBI Deputy Governors Subir Gokarn and Rakesh Mohan, RBI Deputy Governor Urijit Patel, Chief Economic Advisor Arvind Subramanian and Economic Affairs Secretary Shaktikanta Das.

A number of media reports had also named State Bank of India Chairperson Arundhati Bhattacharya as one of the contenders.

PM Modi and Finance Minister Arun Jaitley are said to have already taken a decision on the matter.

Subramanian, Das and Bhattacharya may not be in contention anymore. Jaitley is said to be keen for Subramanian to continue working in the Finance Ministry. Das' chances look slim as top officials have said earlier that bureaucrats may not be preferred. Bhattacharya has also been ruled out.

Till an official announcement is made though, it would be wrong to completely rule out Gokarn, Patel and Mohan, with their economic nous, macro-economic understanding and previous administrative experience.

Born on September 30, 1952, the 64-year old Panagariya has been a vocal supporter of Modi’s economic policies not only in the centre but also in Gujarat. He did his Masters In Economics from Rajasthan University in 1973 and Ph.D in Economics from Princeton University in 1978 in International Economics and Development Economics.

Also, Panagariya is a former Business Standard columnist and a protégé of renowned economist Jagdish Bhagwati.