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Is Reserve Bank of India Governor Raghuram Rajan on his way out? Earlier this month, a comment to a reporter by the head of India’s Central Bank drew fire from Prime Minister Narendra Modi’s party. Mr. Rajan played down talk of India as a bright spot in the global economy by citing an Indian proverb: “In the land of the blind, the one-eyed man is king.”
Commerce Minister Nirmala Sitharaman quickly declared that she “may not be happy” with Mr. Rajan’s choice of words. Junior Finance Minister Jayant Sinha echoed his colleague’s sentiments: “We are the shining star. I don’t agree with what the governor said.”
Senior Indian officials don’t usually admonish each other in public. That Mr. Rajan’s comment—an innocuous warning against premature hubris about high growth—drew ministerial backlash suggests trouble between the governor and the Modi administration. It could signal that Mr. Modi will refuse to extend Mr. Rajan’s tenure when his three-year term expires in September.
A full-text version of this article may be found in The Wall Street Journal.
Source: New AEI Feed
The feud at India’s central bank