India’s Central Bank Governor has recently made a shocking announcement of his resignation in the middle of his three-year term, according to BBC News.
When asked about his reasons for leaving his position, Urjit Patel said that it is due to his ‘personal reasons’ in where he did not explain further.
Chaos In Between
Recently, the relationship of India’s Central bank and its government were seemed to be on chaos as the two parties clashed on their ideas when it comes to the financial state of the country.
The Reserve Bank of India (RBI) is complaining that the Indian government was continuously controlling their department. Some of their sentiments include the government’s demands such as continuously loaning small businesses, pushing bad loans to various industries, etc.
As also BTCNN reported, the call of RBI to restrict all crypto-related businesses to function in India seemed to be one of their wrong moves. Since the country’s Supreme Court already petitioned to hear the side of the government when it comes to cryptos.
Ever since these issues, RBI and their Prime Minister Narendra Modi’s government, neither stopped their clashing.
“Governments that do not respect central bank independence will sooner or later incur the wrath of the financial markets, ignite economic fire, and come to rue the day they undermined an important regulatory institution,” says RBI Deputy Governor Viral
Most of the experts said that the coincidence between Patel’s resignation and the governments continuous pressuring were uncanny and this may be the real reason for Patel’s decision to leave his post.
Sign of Protest
Some of RBI’s former bank governors said that Patel’s action might have been a ‘sign of protest’ against the Indian government.
“The resignation is a clear sign of the government trying to interfere with the working of the RBI,” says Finance Minister Yashwant Sinha.
Affects The World
Although the conflict is only between the Indian government and RBI, the effects of these in India and the market can be catastrophic to all industries around the world.
Now, the attention of India focuses on the newly-appointed Central bank governor, Shaktikanta Das — replacing Patel.