The two-year extension given to RBI Governor, Dr Subbarao has been widely welcomed by economists.
Reacting to the announcement, Dr Ajit Ranade, Chief Economist, Aditya Birla Group, said, "It is good to know about Dr. Subbarao's extension. Recently three former RBI Governor's had made a public plea and recommendation for continuing him at the helm of RBI”.
He said that he was appointed in early September 2008, and was immediately "baptized by fire" caused by the Lehman bankruptcy and subsequent financial and economic crisis. I think India withstood that turmoil, not least because of RBI's proactive and also creative response to the global turbulence.
Given the current upheavals in global markets due to the downgrade of sovereign U.S. debt by S & P, it would need someone like Dr. Subbarao with a proven track record at the helm, to steer matters here.
“Of course one could pick bones about the RBI not having done enough about inflation. But there I think the RBI has a legitimate alibi about having been undone by the fiscal situation. I welcome the extension given to Dr. Subbarao, he said"
Expertise
Ms Shubada Rao, Chief Economist, Yes Bank, said, "It is very important to have someone capable at the helm in these uncertain and volatile times. The continuity through this reappointment spells something positive for the economy. He has demonstrated his expertise and that is reflected in this extension of his tenure."
Mr S L Bansal, Executive Director, United Bank of India on Tuesday said that Dr D Subbarao’s extension will ensure continuity. “Dr Subbarao’s extension is a welcome step as there will be no uncertainty now,” he said.