Banks ask new RBI governor Shaktikanta Das for relaxation in PCA norms

News of Urjit Patel's resignation as head of the Reserve Bank of India has sent shockwaves through the country's markets

News of Urjit Patel's resignation as head of the Reserve Bank of India has sent shockwaves through the country's markets

Newly appointed Reserve Bank of India Governor Shaktikanta Das on Wednesday promised to try and uphold the value and autonomy of the institution and said his immediate focus will be on the banking sector.

In his resignation letter, however, Patel cited "personal reasons" for his decision.

"The policy of the RBI normally shows how the country will act in terms of spending, and right now, because his [Urijit Patel's] departure was so sudden, nobody knows what the plan for the future is", said one official, speaking to Times of Oman. It was expedited as the government didn't want the post to remain vacant at a crucial juncture. The latter had been at the forefront of new lending in the past three years, which in turn fueled domestic consumption and economic growth.

On the relationship between the central government and the central bank, he said, " I don't know if the relationship is good or not, but we have to have stakeholders' consultation. Now that he's moving to the regulatory side, Das may even have to resist some of the ideas he supported when in government. At present, he is also the government's representative at the Group of 20 summits.

Shaktikanta Das is a 1980 batch IAS officer from Tamil Nadu cadre.

Bomb kills three in Iranian port city Chabahar: state media
A year ago, the group claimed to have blown up an oil pipeline in Iran's southern Khuzestan province. Washington has granted exceptions to some USA sanctions on Iran for the project.

That line of thought found endorsement from Finance Minister Arun Jaitley.

Mumbai: Saying the Centre has not destroyed "the Reserve Bank of India (RBI) as an institution", Union minister Nitin Gadkari asserted that the apex bank is part and parcel of the government.

The relaxation sought for weak banks under the PCA framework may take longer than anticipated as the matter was referred in the previous meeting to the board of financial supervision that is headed by the RBI governor, said a person familiar with the development. The government feels the need to revisit the PCA guidelines as the restrictions on the banks is stifling their growth with their lending ability getting impacted.

The comments come days after the past governor Urjit Patel suddenly resigned + in protest following a host of issues with the government, including those on autonomy and its operational integrity, and the appointment of ex-bureaucrat Shaktikanta Das + as the new governor, who has been the pointsman of the Modi government during the controversial note-ban months, within a day of Patel calling it quits.

The 18-member RBI board will also deliberate on relaxation of prompt corrective action norms.

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