Govt at times clashed on rates with RBI: D Subbarao

A photograph of D Subbarao with his colleagues when he took over the 22nd Governor of the Reserve Bank of India (RBI) position on September 5, 2008. Image Source: Official Website

Former RBI Governor and present Indian Economist D Subbarao in an interview with Zee Business on Tuesday said that both Finance Ministers of the earlier UPA-led government had intervened in the work flow of the central bank during his tenure as the governor.

As far as interest rates are concerned, the UPA government had differences with the Reserve Bank of India (RBI) several times during his tenure, he added.

Subbarao said former finance ministers-Pranab Mukherjee and P Chidambaram- had interferred in the RBI's working during his tenure as the governor.

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Mukherjee was angry with RBI for not reducing the interest rates, Zee Business reported citing the former RBI Governor as saying. Even Chidambaram wanted the central bank to keep the rates low.

Speaking about present RBI Governor Raghuram Rajan's exit from the central bank after September 4 this year and not continuing the second-term, Subbarao said he was surprised about Rajan's decision and have no idea why the governor did this.

Watch a short clip of former RBI Governor D Subbarao interview here-

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D Subbarao Economy Pranab Mukherjee P Chidambaram UPA Reserve Bank of India (RBI)Raghuram Rajan Interest Rates Rate Cut