'After a long time, we have a governor who is approachable. The RBI's interactions with us are now much better.'
Come December 2024, you will likely have a new incumbent at Mint Road's helm when Governor Shaktikanta Das completes his two-term tenure.
He had taken charge after two high-profile names -- Raghuram Rajan and Urjit Patel had signed off -- following differences with the government.
Bankers say Das' stint has been a refreshing change. "After a long time, we have a governor who is approachable. I can say that because the RBI's interactions with us are now much better," says a bank's corner office occupant.
A measure which is often mentioned is Das' decision to set up the second Regulation Review Authority (RRA 2.0) in November 2021; its recommendations in June 2022 must surely go down as a major reform.
This came two decades after Y V Reddy as deputy governor set up the first RRA in 1999 (he was appointed governor on September 6, 2003, and served in that position for five years.)
RRA 2.0 incorporated some of the best practices from global central banks regarding consultation ahead of policy formulation, taking feedback from regulated entities (REs) and trade bodies, and structured meetings with chief executive officers and senior compliance officials.
This was in response to REs long-held view that guidelines have to be in step with market realities.
It was an indirect way of putting it across that RBI circulars had not been adequately factoring in commercials.
RRA 2.0 has not got the recognition it deserves as a significant reform.
It's now up to REs to take advantage of the new 'open door policy' of RRA 2.0 of the RBI and foster a better engagement with it and understand the concerns of the regulator rather than merely making submissions from a commercial point of view.
Another sterling moment has been the RBI's handling of the pandemic and the forbearance measures it set in motion.
The deftness helped the economy tide over a critical phase and we are now the fastest growing economy in the world.
And to Das goes the credit of hiking the governance premium in REs.
The RBI's twin interactions in May last year with the boards of state-run and private banks laid bare the shortcomings on this front.
Falling in the same family of thought is the draft omnibus framework for self-regulatory organisations.
Perhaps the best thing which has happened so far has been the mending of relations between Mint Road and North Block.
Das richly deserves being ranked 'A+' in the Global Finance Central Banker Report Cards 2023 in September last year and 'Governor of the Year' by the international publication, Central Banking earlier in March.
Das is a true-blue Sherpa!
Feature Presentation: Aslam Hunani/Rediff.com
