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Timeline of events that preceded Urjit Patel's resignation

December 10, 2018 21:55 IST

A 10-hour RBI central board meeting, on November 19, decides to set up a panel on the economic capital framework for the central bank and directs it to give forbearances to small businesses.

Reserve Bank Governor Urjit Patel, who faced the possibility of an unprecedented action from the government over differences on a variety of issues resigned on Monday from his job citing personal reasons.

Following is the chronology of events that led to his exit:


Aug 8, 2018: Government appoints die-hard Sangh ideologue S Gurumurthy, and cooperative banker and Swadeshi supporter Satish Marathe to the RBI's central board as independent directors.

Mid-Sep: Government cuts short the term of RBI central board member and noted banker Nachiket Mor, who is also associated with the Bill & Melinda Gates Foundation.

Oct 10: Government invokes the never-before-used Section 7 of the RBI Act to force down decisions it wants RBI to take through three letters with over a dozen demands. RBI replies to these letters a week later.

Oct 23: RBI holds a marathon board meet that lasts for around eight hours but remains inconclusive on most issues that government brought in.

Oct 26: Deputy governor Viral Acharya goes public to assert RBI's autonomy, warns of the wrath of the markets if it is not maintained through a speech.

Oct 29: Another deputy governor NS Vishwanathan delivers a speech in Jamshedpur, making clear RBI's reluctance to bring down capital levels for banks.

Oct 31: Government reiterates need for RBI autonomy as "essential" but calls for better governance at RBI.

Nov 3: Economic affairs secretary SC Garg cites improvements in market indices, the rupee and crude to make light of Acharya's "wrath of markets" remarks.

Nov 9: Garg says discussions are on to fix an 'appropriate economic capital framework for RBI' and say it government does not want the RBI money.

Nov 15: RSS ideologue and central board member S Gurumurthy says standoff between RBI and government not a "happy thing".

Nov 17: Ahead of RBI board meeting, Finance Minister Arun Jaitley says growth should not be throttled by squeezing liquidity to the needy sectors.

Nov 19: A 10-hour RBI central board meeting decides to set up a panel on the economic capital framework for RBI and directs it to give forbearances to small businesses.

Dec 5: Governor Urjit Patel refuses to answer queries on frictions between RBI and government, amid reports of truce between the two.

Dec 10: Patel resigns, citing personal reasons.

Photograph: Reuters

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