19/08/2016 5:04 PM IST | Updated 20/08/2016 9:59 PM IST

Urjit Patel Takes Over From Raghuram Rajan As New RBI Governor

Patel has been RBI's Deputy Governor since 2013

Hindustan Times via Getty Images
Urjit R. Patel

The government has named Urjit R. Patel as the new governor of Reserve Bank of India, succeeding Raghuram Rajan who resigned from the position in June.

Patel, 52, is currently RBI's deputy governor, responsible for the bank's monetary policy and is one of the main architects of India's inflation target and rate-setting panel. He has previously worked with Boston Consulting Group and Reliance Industries.

Known as an "inflation warrior" and seen as a close aide of Rajan, Patel has been RBI's Deputy Governor since 2013.

Patel has a PHD in Economics from Yale University (1990) and M. Phil from Oxford University (1986). He worked with the International Monetary Fund (IMF) between 1990 and 1995 covering the US, India, Bahamas and Myanmar desks.

He will be the eighth Deputy Governor to be made governor at RBI. Among the challenges of his new role are completing RBI's clean up of bad loans at public banks, and keeping inflation in check.

Since Rajan's surprise announcement to leave RBI in June, several names had been in the fray for the RBI governor's post including Patel, Subir Gokarn, a former deputy governor with RBI, State Bank of India Chairperson Arundhati Bhattacharya, Arvind Subramanian, Chief Economic Advisor to Modi government, and Policy Advisor Arvind Panagariya.

Patel's appointment comes at a time when India is seeing high inflation and its public sector banks are cleaning up a swath of bad loans and under-performing assets.

Indian government has recently committed to an official inflation target of four per cent, which was recommended by a panel that was headed by Patel. India is also transitioning to a new monetary policy framework, the Monetary Policy Committee, a panel that will decide interest rates instead of the governor taking a sole call on interest rates. The MPC is a "fundamental institutional reform" that is expected to modernize the monetary policy framework, Rajan has said previously.

Rajan, who is on leave as a professor of finance at Chicago University, and former Chief Economist and International Monetary Fund is set to return to academia after his term ends on September 4. Under Rajan's watch, RBI took on a slew of initiatives such as controlling inflation, mandated the balance sheet clean up of banks, as well as new regulatory guidelines for peer-to-peer lending and payment banks.

Patel was also a Consultant (1998-2001) to the Ministry of Finance, Department of Economic Affairs, New Delhi.

Some of Patel's previous assignments include as President (Business Development), RIL; Executive Director and Member of the Management Committee, IDFC (1997-2006); Member of the Integrated Energy Policy Committee (2004-2006) and Member of the Board, Gujarat State Petroleum Corporation Ltd.

Between 2000 and 2004, Patel worked closely with several central and state high-level committees, such as, Task Force on Direct Taxes, Finance Ministry, Advisory Committee (on Research Projects and Market Studies), Competition Commission of India, secretariat for the Prime Minister s Task Force on Infrastructure, Group of Ministers on Telecom Matters, Committee on Civil Aviation Reforms, Ministry of Power's Expert Group on State Electricity Boards and High Level Expert Group for Reviewing the Civil & Defence Services Pension System.

With PTI inputs