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RBI Governor Raghuram Govind says no to second term

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Ending months of suspense, Reserve Bank of India (RBI) Governor Raghuram Govind Rajan formally told his colleagues on Saturday that he is not keen on a second term at the helm of the country’s central bank and will return to academia when his tenure ends in September.

Soon after, Finance Minister Arun Jaitley, while appreciating Rajan’s role, said a successor will be named soon.

Rajan’s decision was conveyed in an 888-word letter by him to the RBI staff, a copy of which was obtained by IANS — one in which he has listed what the central bank has managed to achieve in the past three years and what remains to be done, although that process has also been initiated.

Reflecting on his term as the 23rd governor of the central bank since September 2013 — which has seen praise and also a fair share of criticism — Rajan said the agenda pursued by his team was to help nurse India back on the path of recovery first, and then growth, and keep prices in check.

He went on to allude that much was accomplished, even as a part of that onerous task remained a work in progress — while also indicating that he was ready to see that through as well, but eventually decided against it.

“While I was open to seeing these developments through, on due reflection, and after consultation with the government, I want to share with you that I will be returning to academia when my term as governor ends on September 4, 2016,” he said.

“I will, of course, always be available to serve my country when needed,” he added.

“I am an academic and I have always made it clear that my ultimate home is in the realm of ideas. The approaching end of my three year term, and of my leave at the University of Chicago, was therefore a good time to reflect on how much we had accomplished.”

Stating that he will be returning to the US university, from where he is on a sabbatical, Rajan listed his unfinished agenda as seeing a monetary policy panel in place to broadly guide the central bank, and a clean-up of banks’ balance sheets.

Listing the achievements, since the time India’s growth was high and inflation also high when he took over, the governor said price control, improving foreign exchange reserves, currency stability, an eventual lowering of interest rates and extending a helping hand for reforms stood out.

He hoped the unfinished agenda for which the path had been paved will be pursued by his successor — the 24th governor of the Reserve Bank — again a matter of much debate and interest, with some names already doing the rounds.

Much speculation had gone into a possible second term for Rajan, hailed by many as the best governor the central bank could have possibly had on its board during the difficult times India was going through, but also with some share of critics.

In fact, a petition floated online pushing for a second term for this IIT alumnus, had tens of thousands of netizens rooting for him, even as some critics like BJP leader Subramanian Swamy were particularly harsh towards him, asking Prime Minister Narendra Modi to let him go. Both Modi and Finance Minister Jaitley remained silent all along.

On Saturday, Jaitley said: “The government appreciates good work done by RBI Governor Raghuram Rajan and respects his decision.” He said a successor would announced “soon”.

Speculation gathered momentum when Anandabazar Patrika, quoting sources close to Rajan, said in a report two weeks ago that he was not interested in a second term, which got some credence when Modi said: “I don’t think this administrative subject should be an issue of interest to the media.”

Now that he has said no, RaghuramRajan is the hashtag trending at the top, mostly in his support.

Infosys co-founder N.R. Narayana Murthy, who has been batting, in fact, for not one but two more terms for Rajan, said: “Have no doubts he will continue to add value to the country. He deserves more dignity than what he was treated with.”

Swamy remained unrelenting. “Raghuram Rajan was an employee of the Government of India. We don’t select employees on the basis of popular vote — and, too, of industrialists,” he said.

Politicians seldom like someone outside their tribe shooting off his or her mouth. But a doctoral degree holder from the Massachusetts Institute of Technology, Rajan has always been outspoken — often getting pushed onto the wrong side of a debate.

The latest being his remarks on India being the king in a land of the blind which did not go down well with many, particularly the BJP leadership and notably Commerce and Industry Minister Nirmala Sitharaman.

But Rajan, who has also served in the International Monetary Fund, has been used to such critics.

Before he shot to global fame with his prediction of a looming global financial crisis way back in 2005, he had to face ridicule from such luminaries as then Federal Reserve chief Alan Greenspan and Nobel laureate Paul Krugman. He had the last laugh, so to say, when that became a reality.

What had started as an academic paper titled “Has Financial Development Made the World Riskier?” also eventually resulted in an Academy Award-winning documentary called “Inside Job”, bringing Rajan further into global limelight.

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Azim Premji and Dr Devi Shetty chosen for PCB awards

Besides them 25 senior journalists have been selected for the ‘Press Club Annual Awards’, a release said.

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Azim Premji Wipro

Bengaluru, Jan 19: The chairman of Wipro Limited Azim Premji and the founder chairman of Narayana Health Dr Devi Prasad Shetty are among those who have been selected for the annual awards given by the Press Club of Bangalore.

Premji has been chosen for ‘Press Club Person of the Year’, while Dr Shetty and actor-Director Sudeep Sanjeev have been selected for the ‘Press Club Special Award.’

Besides them 25 senior journalists have been selected for the ‘Press Club Annual Awards’, a release said.

Chief Minister B S Yediyurappa will facilitate the awardees at a function scheduled for the third week of February, it said.

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Healthcare sector revenues likely to grow by 20% in FY22: ICRA

he risks to the recovery could be in the form of additional regulatory measures, protracted restrictions on international travel and jump in Covid-19 cases”.

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New Delhi, Jan 19: Even as the healthcare sector witnessed squeezing of revenues due to the Covid-19 pandemic, its long-term outlook remains stable on the back of swift rebound in occupancy as well as structural factors, ICRA said on Monday.

The rating agency expects the occupancy of companies in the sector to bounce back substantially to 60 per cent in FY22, from the estimated occupancy of 52 per cent in FY21, and the revenue growth to be at 20 per cent in FY22, against an estimated contraction of 19 per cent in FY21, aided by a lower base as well.

There has been significant sequential improvement in occupancy every month after the sharp fall in April and the pent-up demand is also likely to support the performance, as elective procedures cannot be delayed indefinitely by domestic as well as international patients, the report noted.

Due to the high operating leverage, the EBITDA margin is likely to rise to 13 per cent in FY22, against an estimated EBITDA margin of 9 per cent in FY21. The capital expansion was already slowing down, even pre-Covid, and is likely to remain modest in FY22 as the players have adequate capacity to grow over the medium term and the near-term focus is on better utilisation of the existing facilities rather than expansion of the network.

Consequently, the capex as well as startup costs of new hospitals are likely to be much lower going forward, which will also aid profitability. The net debt is expected to stay largely range-bound, but the debt protection metrics is likely to improve significantly due to a sharp rise in accruals, ICRA said.

According to Kapil Banga, Assistant Vice President, ICRA: “The credit risk profile of entities in the sector had been on improving the trajectory over the last two years and notwithstanding the near-term disruption due to the pandemic, as well as given the essential nature of the services, ICRA believes the sector will resume on its growth trajectory in FY22. The risks to the recovery could be in the form of additional regulatory measures, protracted restrictions on international travel and jump in Covid-19 cases”.

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Excise duty collection surges 48% in FY21 on high fuel levies

The total excise duty in the last financial year was over Rs 2.39 lakh crore.

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Modi Poster on Petrol Pump

New Delhi, Jan 17 : As the government has kept excise duty on petrol and diesel elevated amid the pandemic with a view to increase revenue, the total excise duty collection during April-November FY21 has surged nearly 48 per cent as compared to the year ago period.

The excise duty collection during the first eight months of the current financial year was over Rs 1.96 lakh crore, compared to over Rs 1.32 lakh crore collected during April-November FY20, official data showed.

The collection in November 2020 was highest so far in the financial year 2020-21 at Rs 35,703 crore. In November 2019, excise duty collection stood at Rs 18,948 crore.

The total excise duty in the last financial year was over Rs 2.39 lakh crore.

As fuel prices are at record high despite low crude oil prices, demand has been raised from several quarters to reduce the excise duty on petrol and diesel to provide relief to the common man.

In the national capital, petrol is sold at a record high level of Rs 84.70 a litre while diesel is priced at Rs 74.88 per litre.

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