The world won't end for India with Raghuram Rajan leaving

For the past several days, one must have come across several reports singing paeans to RBI governor Raghuram Rajan. These reports give an impression that the Indian economy will crumble if the "super economist" is not retained after September 4.

Such reports will flummox any layman. Would there be no life for the Indian economy after Rajan? Is he the be all and end all of this ancient country? Was no other RBI governor as qualified as he is or will there be no one ever after him?

One is forced to ask these questions because if Rajan was such a super economist, why did he fail to rein in inflation and reduce interest rates on home loans or loans for entrepreneurship? Also, why couldn't he extricate the banks from the mess of NPAs?

Why is there such an uproar over Rajan not seeking a second term? Is he being sacked? No. Was there any undertaking that the government will retain him for two terms? No.

Then, what was so exceptional about him that he should get a another term? Several of his predecessors were more qualified than him. His immediate predecessor D Subbarao and former prime minister Manmohan Singh - under whom Rajan was appointed the RBI governor - were no less qualified than him.

Why this hullabaloo about Rajan's impending exit then? Rajan is not indispensable. It will not make any difference to the Indian economy if he goes. Chances are the economy may perform better after he is replaced by a more suitable candidate.

The brouhaha over Rajan's exit seems to be overhyped. After Rajan announced his decision on June 18 (Saturday) to not continue for another term, there was gloom and despondency in certain quarters. It appeared that the BSE Sensex would collapse when it will open on June 20 (Monday). However, when on the first day of the week, it closed 241.01 points (0.91 per cent) higher than what it had closed on the last day of the last week.

The Rajan factor did not make any difference to the BSE Sensex ever since he became the chief economic adviser to the finance ministry on August 10, 2012. Even last week, which was full of suspense over his fate, the BSE Sensex was neither bullish or bearish. But it was like a royal tiger, walking at its own pace.

The dollar-rupee exchange rate has done worse since August 10, 2012. On that day, one dollar was equal to Rs 55.3440. On June 20, 2016, two days after Rajan announced his future plans, the rupee got devalued and it stands at 67.4087.

Hence, Rajan's continuation as the RBI governor may not help the Indian currency that much.

This brings us to the point whether there is a motivated campaign to defame the Modi government. If one observes closely, s/he will find that more or less the same section of the society which had raised hue and cry over issues such as the Ishrat Jahan's encounter, Dadri lynching, beef ban and JNU row are peddling Rajan's tenure as a major issue.

The furore over Rajan's exit gives the impression that India is a backward country and there is an acute dearth of talent. But we do have able economists and financial luminaries such as World Bank's chief economist Kaushik Basu, HDFC chairman Deepak Parekh or SBI chairperson Arundhati Bhattacharya who are capable enough to replace him. But a section can't move beyond Rajan.

This section is promoting a personality cult by giving more importance to an individual rather than an institution. Had the role of personality been so significant, India would not have witnessed inflation and poor management of the economy under the prime ministership of renowned economist Manmohan Singh.

Hailing Rajan in such a manner also mocks the role of the two finance ministers - P Chidambaram and Arun Jaitley - in whose terms he has served. It appears as if the ministers did not have any role in shaping the economy of India.

If Rajan is so capable, why is he returning to Chicago University to teach in the economics department? Why did the World Bank not find him fit enough to make him its chief?