Govt likely to finalise both RBI dy governor replacements together

H R Khan, one of the RBI’s seven executive directors, likely to replace Gopinath.

The government is likely to finalise replacements for both the retiring deputy governors of the Reserve Bank of India (RBI), Usha Thorat and Shyamala Gopinath, simultaneously. Gopinath retires in June next year and Thorat in November.

According to sources, H R Khan, one of the seven executive directors (EDs) of RBI, is likely to replace Gopinath. Another ED, Anand Sinha, will replace Thorat. On seniority, Sinha is third among the EDs and Khan is sixth.

Sinha is presently looking after the departments of banking operations and development, expenditure and budgetary management and financial stability unit. Khan looks after government and bank accounts, internal debt management, foreign exchange and external investment, and operations.

As an ED, Sinha's term in Mint Road will be completed in February next year, while Khan's will be in 2014. The retirement age for all RBI employees is 60 years, while for the governor and deputy governors, it is 62. A deputy governor could be appointed for a maximum of five years or till the age of 62, whichever is earlier.

After declining to re-appoint Thorat, the government had formed a search panel headed by RBI governor D Subbarao to identify a replacement. The committee had called all seven EDs for interviews. However, one of them, C Krishnan, declined to appear. Of the seven, V K Sharma was the most senior, with almost two and half years of service left.

On the earlier two occasions for appointing deputy governors from within RBI, in the cases of K J Udeshi and Usha Thorat, both were appointed by superseding others — K L Khetrapal and P K Biswas, respectively. While Khetrapal resigned in protest, Biswas appealed against Thorat's appointment. While the Delhi high court dismissed Biswas, petition, it said guidelines should be prepared on the criteria for consideration of eligible candidates for the job.

Among the four deputy governors, while two are from within RBI, one is from commercial banks and the other an economist.

Thorat is in charge of portfolios like banking operations and development, banking supervision, currency management, rural planning and credit departments. Gopinath is in charge of financial markets, foreign exchange, payments and settlement and non-banking supervision, among others. Thorat and Gopinath have 19 departments between them.