World Bank head calls Rajan a 'great' central bank governor

Describing Raghuram Rajan as a "great" central bank governor, World Bank President Jim Yong Kim has hoped the Indian leadership will continue with the policy of having an independent Reserve Bank chief.

"He (Rajan) is so well respected. I think he has done a great job," Kim, who is here on a two-day visit, told reporters at the India office of the World Bank.

On Rajan's untimely exit, Kim said he did not know the whole story, but added "I understand he is going back to academia at some point in time. He is an extremely respected and productive scholar in addition to being a great central bank governor."

Rajan on June 18 had announced that he will return to academia when his three-year term as Governor of the Reserve Bank of India ends on September 4, ending uncertainty about his continuation in light of BJP MP Subramanian Swamy's triad against him.

Talking about Prime Minister Narendra Modi, the World Bank President said, he is a "big fan" and hoped the BJP government will continue with the policy of having an
independent central bank.

"I think the Modi government has made it clear that they will continue with the important principle of having an independent central bank," he said.

Kim, who met Modi earlier in the day said, many things have been said that confirm his opinion that it is not about a single person but about certain principles and practises that they would adhere to.

"I don't expect there will be a major shift because the principles of independent central bank, someone who is respected, I think will continue," he said.

Rajan, 53, was appointed by the previous Congress-led UPA government in September 2013 for a three year term. He is the second Reserve Bank Governor who will be leaving the Mint Road headquarters of the India's banking sector regulator without getting a five-year term in the last 25 years.