1. [Jan 14, 2013](https://rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=27952) - Dr. Urjit Patel takes over as RBI Deputy Governor 2. [Jan 08, 2016](https://rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=35933) - Dr. Urjit R. Patel re-appointed as RBI Deputy Governor for Three Years 3. [Sep 05, 2016](https://rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=37969) - Dr. Urjit R. Patel took over as RBI Governor ## Profile 1. [Link](RBI_Press%20Release_20160905_Dr.%20Urjit%20R.%20Patel%20takes%20over%20as%20RBI%20Governor.pdf) ## Resignation on Dec 10, 2018 1. Dr. Urjit Patel announced on 10 December 2018 that he was stepping down from the post of RBI Governor, effective immediately, citing "personal reasons." 2. His term was due to expire in September 2019, so this was a rare case of a serving governor leaving midway through his three-year term. **Background: the RBI–Government tussle** 1. The resignation came after the central bank's spat with the Finance Ministry over issues of autonomy and governance. 2. The rumored key friction points, as reported were: 1. the government wanted RBI to help NBFCs and SMEs with liquidity support, 2. liberalise the [Prompt Corrective Action (PCA) Framework](Prompt%20Corrective%20Action%20(PCA)%20Framework.md), 3. and take other growth-supportive steps amid a slowing economy ahead of the 2019 general elections. 3. The government also sought transfer of over ₹3 lakh crore of RBI's reserve capital. This is the [Economic Capital Framework](Extant%20Economic%20Capital%20Framework%20of%20the%20Reserve%20Bank%20of%20India-2015.md) dispute (later resolved via the Bimal Jalan Committee in 2019). 1. The Bimal Jalan Committee (set up in Dec 2018, reported Aug 2019) fixed a formula for RBI's capital buffer and surplus transfer. 2. RBI had transferred approx. ₹1.76 lakh crore to the government in 2019, partly resolving the standoff. 4. Deputy Governor [Dr. Viral Acharya](Viral%20V.%20Acharya,%20Dr..md), in his speech titled [On the Importance of Independent Regulatory Institutions – The Case of the Central Bank](https://rbi.org.in/scripts/BS_SpeechesView.aspx?Id=1066) delivered on Oct 26, 2018, had earlier warned that governments which don't respect central bank independence would eventually "incur the wrath of financial markets, ignite economic fire, and come to rue the day they undermined an important regulatory institution." **Does the Act allow Govt. to give directions to RBI?** 1. Section 7 empowers the central government to give directions to RBI, after consultation with the Governor, in the public interest. 2. It had never been invoked since RBI's formation. Reports emerged that the Centre was considering invoking this provision — widely seen as the immediate trigger for the crisis, though officially the government denied formal invocation before the resignation. **Aftermath** 1. Predecessor [Dr. Raghuram G. Rajan](Raghuram%20G.%20Rajan,%20Dr..md) (September 2013 and September 2016), in an [interview to ET now on Dec 11, 2018](https://economictimes.indiatimes.com/news/economy/policy/urjit-patels-resignation-is-a-note-of-protest-raghuram-rajan/articleshow/67035016.cms?from=mdr), called it a "protest" resignation and said every Indian should be concerned about what happened at RBI (Rajan himself had earlier not been given an extension by the same government). 2. Shaktikanta Das was appointed the next Governor shortly after. 3. The episode led to a broader debate on [central bank autonomy](Autonomy%20of%20RBI.md). Rather, it became a recurring theme (Rajan's exit in 2016, this episode in 2018) ## Related Notes 1. [About the RBI](About%20the%20RBI.md) 2. [Chakravarthi Rangarajan, Dr.](Chakravarthi%20Rangarajan,%20Dr..md) 3. [Duvvuri Subbarao (2008 to 2013)](Duvvuri%20Subbarao%20(2008%20to%202013).md) 4. [Raghuram G. Rajan, Dr.](Raghuram%20G.%20Rajan,%20Dr..md)