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RBI Deputy Governor Viral Acharya resigned 6 months before his term ends, Cites “Personal Circumstances”

RBI Deputy Governor Viral Acharya resigned 6 months before his term ends, Cites “Personal Circumstances”: Viral Acharya, Deputy Governor of the Reserve Bank of India (RBI), has resigned, citing “unavoidable personal circumstances”, six months before his term ends. Mr. Acharya, whose term was scheduled to end in February, conveyed his decision to the central bank in a letter. “Consequential action arising from his letter is under consideration of the Competent Authority,” the RBI said in a statement today.

HIGHLIGHTS

  • Although Acharya has not announced his plans yet, it is expected within RBI that Viral Acharya will be returning to Academia
  • He was appointed as a deputy governor by the government towards the end of 2016 for a term of three years

Acharya, who was in charge of monetary policy, will return to New York University as an economics professor in August instead of February 2020. He would be joining his family which he has been away from.

He took office at the RBI in January 2017 for a three-year term. His departure follows Urjit Patel’s sudden resignation in December last year amid rising tension between the central bank and the government about the RBI’s independence. Shaktikanta Das was appointed governor shortly after Mr. Patel quit. Acharya has been uncomfortable ever since the exit of Urjit Patel as Governor of RBI. His academic views of the financial system were in contrast with the rest of the system. Dr. Acharya has been differing with the Governor in the last two monetary policy meetings on both growth and inflation.
A spokesman for the RBI said on Monday he was unaware of the development. Acharya didn’t immediately reply to a message from Bloomberg seeking comment.

Business Standard cited people it didn’t identify as saying Acharya handed in his resignation a few weeks before the RBI’s June monetary policy committee meeting. When asked for further comments, he told the newspaper: “A schoolteacher once told me: ‘When your work speaks for itself, do not interrupt.’”

According to the reports, N.S. Vishwanathan, a deputy governor whose term is due to end in the first week of July, is likely to stay on for another term.

The report also mentioned that Michael Patra, executive director at the RBI, and Sanjeev Sanyal, principal economic adviser at the Ministry of Finance, are among possible successors to Acharya.