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Book Review: The Man And His Message

The book is a great compilation of Raghuram Rajan's experiences, articles and speeches

When former RBI governor takes the stage, the world watches. In this case is the launch of his book I Do What I Do, a title based on one of his remarks during a press conference on the monetary policy in September 2016. Rajan, in his policy, had cut interest rate by 0.5 per cent, nearly double of what was expected. At the press conference, Rajan was asked if he was being the Santa Claus since it was a generous cut in interest rate, or if he was being hawkish. To which, Rajan had replied, “I don’t know what you want to call me... Santa want to call me a hawk, I don’t know. I don’t go by this. My name is Raghuram Rajan and I do what I do.”

Rajan became the 23rd RBI Governor of India on 4 September 2013. The book is a great compilation of his experiences, articles, and past speeches, on different occasions and themes, ever since he took over as the RBI governor. The book also mentions the little trouble he had during his sojourn in RBI and when he was at the helm of the affairs.

He narrates in the very first chapter of his book Setting The Stage, that he was asked to join as the RBI Governor, by P. Chidambaram who was the Finance Minister, and under the cabinet of former Prime Minister Manmohan Singh. He further concedes, it was an uncertain time and the rupee was witnessing a free fall, and inflation and the current account deficit were high. It was also a time when the investors were very nervous anticipating a hung parliament, as the 2014 elections were expected to happen.

However, immediately after taking charge, Rajan presented the first monetary policy and tried to boost investors' confidence and take control of the inflation. In Dosanomics, he narrates, how industrialists were grumbling about high rates and while retirees complaining about low rates they get on their deposits. In this scenario, he shared, both the parties were overstating and the solution that he suggested to bring down the differences, was to bring down CPI inflation steadily.

In all the sections of the book, one would find great content, narratives and information. For example, in the third section of the book, Assume Anarchy, he writes institutions are all a rage and the absence of institutions -- such as inefficient and impartial judiciaries, legal systems to protect intellectual property, tax administrations that are efficient and free from corruption, and credible central banks -- is offered as explanation for few of the puzzles in development economics that includes why so many countries don't grow fast enough to eliminate poverty.

On demonetisation, Rajan assumes short-term benefits might far outweigh the gains in the long term." He reasons, “At no point, during his term was the RBI asked to make a decision on demonetisation”. He reveals that when his views were taken for the first time on demonetisation in February 2016, he had hinted that it might help in the long term, but in short term, it could cost the economy which might outweigh the benefits it might probably assume in the long term.

I Do What I Do is a great compilation of his experiences, articles and speeches and it chronicles the policy and economy journey of India under Rajan's leadership in the RBI.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

Syed S. Ahmed

The author is IT entrepreneur, writer, columnist and cricket enthusiast

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