RBI rejigs deputy guv portfolios; Rajeshwar Rao takes monetary policy dept

Jan 14, 2025

The government has already started the process of finding a successor for Patra

The Reserve Bank of India has redistributed the portfolios of the deputy governor’s after Michael Patra demitted office on Tuesday.

Deputy Governor M Rajeshwar Rao, who is in charge of banking regulation, has been allocated the all-important monetary policy department, as well as department of economic and policy research. These two portfolios, among others, were with Patra. Some of the other portfolios of Patra were distributed with other deputy governors.

RBI has four deputy governors.

The deputy governor in charge of monetary policy is also a member of the rate-setting panel – the monetary policy committee (MPC).

The government has already started the process of finding a successor for Patra. According to media reports, a top government panel comprising RBI Governor Sanjay Malhotra, Cabinet Secretary T V Somanathan, and Department of Financial Services Secretary M Nagaraju is likely to interview candidates this week.

It is to be seen if the government announces Patra’s successor before the next meeting of the MPC, scheduled for February 5-7. The monetary policy department is typically headed by an economist.

Patra was first appointed as the RBI deputy governor in January 2020 for three years. In 2023, his term was extended by one year and by another year in 2024.

Before becoming deputy governor, Patra, a career central banker since 1985, was RBI’s executive director and a member of the MPC since its inception in 2016.

Patra was also the member secretary of the ‘Expert Committee to Revise and Strengthen the Monetary Policy Framework, set up in 2014 headed by the then deputy governor Urjit Patel. The creation of a monetary policy committee and the flexible inflation target framework was recommended by the Patel committee.

[The Business Standard]