Congress MP Shashi Tharoor has recently lauded Shaktikanta Das, the outgoing Governor of the Reserve Bank of India (RBI), for his exemplary contributions to the nation during his tenure. In a heartfelt acknowledgment, Tharoor, who shares a collegiate connection with Das, admitted to having initial reservations about Das’s capabilities due to his academic background in history rather than economics. However, Tharoor’s reservations were soon replaced with admiration as Das proved to be an effective and capable leader of India’s central bank.
Shashi Tharoor’s Tribute to Shaktikanta Das
“A word of tribute to @DasShaktikanta as he demits office as Governor of @RBI,” Tharoor tweeted. “Shakti was my junior in College, but I too had wondered whether an MA in History could take on such onerous financial and economic responsibilities.”
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Tharoor’s candid statement reflects the skepticism that surrounded Das’s appointment in 2018. Yet, he went on to commend Das for exceeding expectations and leaving behind a legacy of service to the nation. “I am delighted that he proved more than equal to the task. He leaves behind an outstanding record of service to the nation. All the best in whatever you next undertake, Shakti!” Tharoor added.
Shaktikanta Das’s Remarkable Tenure
Shaktikanta Das stepped down this week after a six-year term as the 25th Governor of the RBI. He assumed office on December 12, 2018, under challenging circumstances following the abrupt resignation of his predecessor, Urjit Patel. Das initially served a three-year term, which was extended for another three years in December 2021, making him the second-longest-serving Governor in the institution’s 90-year history. Only Benegal Rama Rau, who served for 7.5 years in the 1950s, had a longer tenure.
Das’s appointment sparked debates and raised eyebrows, as many questioned whether his academic training—a master’s degree in history from St. Stephen’s College, Delhi University—equipped him to helm the RBI, especially following economists of the caliber of Raghuram Rajan and Urjit Patel. However, Das’s pragmatic leadership and ability to adapt swiftly to financial and economic challenges silenced critics over time.
Overcoming Challenges and Achieving Milestones
Das’s tenure as RBI Governor coincided with some of the most turbulent times in recent history. His leadership was tested during the COVID-19 pandemic, which wreaked havoc on economies worldwide. Navigating through this unprecedented crisis, Das led the central bank in implementing measures to stabilize the economy, manage exchange rate volatility, and maintain financial system liquidity.
One of the notable achievements during Das’s term was the peak of India’s foreign exchange reserves at $700 billion, which provided a robust cushion against external shocks. The RBI, under Das, adopted a proactive approach to tackling inflation, fostering growth, and managing monetary policies. The Monetary Policy Committee (MPC), chaired by Das, maintained the repo rate at 6.5% over the past 11 reviews, balancing inflation control with economic growth amidst global uncertainties.
Despite these efforts, the RBI faced some challenges towards the end of Das’s tenure. The GDP growth forecast for 2024-25 was revised downward from 7.2% to 6.6%, citing global headwinds and slowing domestic growth. Retail inflation also surged to a 14-month high of 6.2% in October, exceeding the RBI’s tolerance threshold. These developments underscored the complexities of central banking in an interconnected global economy.
International Recognition
Shaktikanta Das’s leadership did not go unnoticed on the global stage. In August 2024, he was named the top central banker worldwide by Global Finance magazine for the second consecutive year. Das earned an “A+” rating alongside Denmark’s Christian Kettel Thomsen and Switzerland’s Thomas Jordan. The rankings, based on factors such as inflation control, economic growth, currency stability, and interest rate management, underscored Das’s ability to navigate the post-pandemic economic landscape effectively.
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In its assessment, Global Finance emphasized the critical role of central bankers in stabilizing economies. “Central bankers have waged war against inflation over the past few years, wielding their primary weapon: higher interest rates. Now, countries around the world are witnessing the tangible results of these efforts, as inflation has dropped significantly,” the magazine noted.
Bridging Skepticism with Success
When Das took over as RBI Governor, skepticism was rampant. Experts and commentators questioned whether his background in history would allow him to meet the demands of leading India’s central bank, especially given the challenging legacy left by his predecessors. Economics professor Amol Agrawal from Ahmedabad University candidly admitted, “If you had asked me in 2018 if Das was the right choice, I would have expressed doubt. Yet here we are in 2024, standing strong.”
Das’s pragmatic decision-making and his collaborative approach played a pivotal role in overcoming these doubts. His tenure serves as a reminder that expertise is not always confined to academic credentials but also encompasses leadership qualities, adaptability, and the ability to inspire trust and confidence among stakeholders.
The Road Ahead
As Das steps down, his legacy at the RBI will undoubtedly be analyzed and debated for years to come. He leaves behind a central bank that demonstrated resilience in the face of global and domestic challenges. His journey from a history postgraduate to one of the world’s most recognized central bankers exemplifies the power of dedication, adaptability, and effective leadership.
Shashi Tharoor’s tribute to Shaktikanta Das captures the essence of this remarkable journey. What began with skepticism about his qualifications ended in universal acknowledgment of his achievements. Das’s tenure has not only strengthened India’s financial foundations but also set a high bar for future leaders of the RBI. As he moves on to new endeavors, Das leaves behind a legacy of service, resilience, and excellence that will inspire generations to come.