New Delhi: Hours after it was reported that RBI Deputy Governor has resigned from his position, the central bank confirmed his exit, stating ‘Viral Acharya could not continue his term due to unavoidable personal circumstances’.
Notably, this is the second high-profile exit from the RBI in the last seven months. In December 2018, RBI Governor Urjit Patel had resigned nearly nine months before the end of his scheduled term.
“A few weeks ago, Dr. Acharya submitted a letter to the RBI informing that due to unavoidable personal circumstances, he is unable to continue his term as a Deputy Governor of the RBI beyond July 23, 2019,” RBI said in a statement today.
It added,”Consequential action arising from his letter is under consideration of the competent authority.”
Since Acharya was appointed by Appointments Committee of the Cabinet headed by Prime Minister Narendra Modi, the resignation would also be accepted by the panel.
With Acharya quitting, the RBI will be left with three deputy governors N S Vishwanathan, B P Kanungo and M K Jain.
His resignation come days after the latest monetary policy meeting, wherein Acharya had differed strongly with Governor Das on the state of the fiscal deficit. While Das had said that it was unfair to club the borrowings of state-run enterprises into the state of fiscal deficit, Acharya asserted that the borrowing requirement of PSUs matter to the overall deficit.
In October 2018, Acharya’s speech on the need for RBI’s independence had hit the headlines.
In the over 90-minute long speech, Acharya, who was in charge of the monetary policy department, warned of the wrath of the markets if the autonomy of a central bank is compromised.
He had explicitly said he had the backing of former RBI governor Urjit Patel for making the speech.