Urjit Patel set to get second term as Reserve Bank of India deputy governor

NEW DELHI: The government is set to give Urjit Patel a second term as Reserve Bank of India deputy governor. A government official told ET that his name will soon be sent to the Appointments Committee of the Cabinet (ACC) for final approval.

"He will get an extension and continue his term,” the official said. “Since there will be no vigilance clearance required it should not take much time.”

Patel, seen as a key lieutenant of RBI governor Raghuram Rajan, was initially appointed for a three-year term in January 2013.

Although about a dozen candidates had applied for the job, the government decided to extend Patel's tenure to maintain continuity at a time when reform initiatives such as the monetary policy committee and public debt management agency are underway. Patel has been involved in some of the changes in the way RBI does things.

Acentral bank committee headed by Patel recommended in 2014 that the RBI base its policy deliberations on consumer inflation rather than the index related to wholesale prices. The central bank did so later that year, adopting the new consumer price index (CPI) as the key measure of inflation.

The Patel-led committee had further recommended that RBI fix the inflation target, based on the CPI, at 4% with a band of plus or minus 2%. This also has been adopted by the central bank. Patel who holds a PhD in economics from Yale and an M Phil from Oxford was advisor on energy and infrastructure at the Boston Consulting Group before joining RBI. The deputy governor had a previous stint with the central bank in 1996-97, when he was on deputation from the International Monetary Fund (IMF) and provided advice on the development of the debt market and banking sector reforms.