Principled opposition to Arvind Subramanian as RBI head

Is it time for India to look within for the next RBI Governor and not look at an NRI?

Does India need another NRI for RBI Governor?
Does India need another NRI for RBI Governor?

[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]here are a lot of media reports that Arvind Subramanian is being considered for the position of the next RBI head, due to the exit of Raghuram Rajan. I support Dr. Subramanian Swamy’s view that both of them are not the right candidates for the position of the RBI governor. I approach this from a risk management perspective and suggest that the Indian government not have NRIs flown in for top positions in the government.

First, it is almost impossible to perform a thorough background check on NRIs living outside India for an extended period of time. While not doubting the patriotism of NRIs to India, the risk of appointing someone with conflict of interest with another nation is very real.

Second, NRIs flown in have less skin in the game than a civil servant who has toiled through the Indian system and served the country. If a civil servant commits an illegal act as the head of a government body and is discovered after his/her term, he/she can be charged for their offences easily when compared to someone who has left the country after his term.

Third, the disconnect between the workings of the Indian government and the NRI can be frustrating for both parties, as evidenced by the debate on interest rates. While the Modi government wanted to create jobs using lower interest rates to fulfil their election promises. Rajan decided to chose an independent path of fighting inflation through higher interest rates and worsened the NPA situation for the PSU banks. This sort of disconnect between the central bank and the government is rarely seen in G20 countries.

Finally, once an appointed NRI finishes his term and goes back to his country of residence, there is a huge potential for leakage of confidential information. This information could be exploited by another country or a large corporation.

[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]his issue has been dubbed as the “revolving door” problem and it is a great source of concern even for the US government, when it appoints its resident citizens as regulators. An investment bank, for example, may get its senior employee to join a regulatory body like the US Federal Reserve or the SEC. Such an employee may bend the rules in favour of his former employer. Once this employee leaves his regulatory position, he may join another investment bank or a consultancy and start advising companies on how to game the regulatory rules.

While the NRIs bring a global perspective to the critical problems that India faces, they are best suited as consultants to the government with limited access to confidential information. The risks of appointing NRIs such as Arvind Subramanian, as the head of RBI is not justified.

1. Text in Blue points to additional data on the topic.


  1. “This sort of disconnect is rarely seen in G7 countries” hahahahaha please see the latest Janet Yellen testimony in the US Congress. Politicians think they know everything about economics – they don’t know squat. When inflation goes up, 100 million Indians eat less food – you don’t care behind your computer sitting in your air conditioned room. Rajan is a great intellectual thinker who made good decisions for all Indians. India is the loser.

  2. I do support Subramanian Swamy’s views in this specific case because AS had spoken against India. However I can’t agree that NRIs cannot be trusted and resident Indian’s should be given priority. It can also turn out that the resident Indian’s after their term in the government can join a private company abroad and still leak information. In the current world, the person who worked in top post need not even travel out of the country, he can leak information using various technology tools available.
    There is also a possibility that the NRIs who worked in International institutions can bring confidential info.
    We need to have certain clauses in their employment like anyone working in top position should serve in other sectors like Railways, healthcare for 1-2 years ( rotate them in different sectors ) after leaving the job to reduce impact though not eradicate it fully.

  3. Thank you for highlighting some interesting issues related to the appointment of NRI in top post in Govt of India the conflict of interest will arise every time they change their Jobs they may be forced to part with important information when they join another corporation or a country. Dr.Swamy has rightly raised this issue without fear in spite of severe opposition to what he is has said. We should unite and stand behind Dr.Swamy who is a genius and has not skeleton to hide in his cupboard.

  4. Dr Subramanian Swamy’s real potential was not realized/didn’t come out in time and the country was a loser. Now that he is in form he has to handle numerous national issues simultaneously.
    His ‘one man army’attitude has brought him the name of a ‘loose cannon’.
    In order that his fights bring fruition he has to share his burden among more selfless nationalistic experts to tackle each case separately and conclude them logically.The country will remaain poorer of his decisive results till then.
    His entry to theB J P is belated as he clutched at his defunct Janata Party for far too long.

  5. how very ingeniously convenient for deshbakth Indians to deny india boen experts and specialists to be gov or cea because of their suspected unindian mindset. Is it necessary to become one as an unindian only when they get a us green card . There are countless millions who ape us habits and mindsets with mere possession of Indian Aadhar card. When we suspect these india born experts with risk potential strangely we welcome 100% FDI defence matters as if those venture provide foolproof security.India is the most fertile place to invest all corrupt ideologies without any circumspection.

  6. It would be interesting to know Dr.Swamy’s views on this considering he has a sizeable fan following of NRIs. And news is those baying for Rajan’s blood are also carrying Indian circuses abroad as sign of going places.

  7. We had excellent RBI governers before RR. Example Subba Rao and YV Reddy. YV reddy insulated Indian economy from sub prime crisis.

    When we have such celebrated Made In Indi governers, why should we get revolving door NRIs?

  8. Some folks are twisting it as “Indians Vs NRIs” and trying to question Modi’s own love for NRIs who truly considers them as people ambassadors of India to the world. But we have to leave the emotion part of it for a moment when it comes to recruiting them as senior positions which decide the direction of our economy.
    We have seen in the past, how a domestically groomed RBI Governors understood our Economy, trends better and acted accordingly.
    Against Subraminian, his submission to Congressional committee against Indian pharma companies in itself makes him ineligible to be CEA let alone RBI Gov. Modi Govt has taken high risk till now!

  9. Yes, we do not want phirangs. We can do it by ourselves. No doubts on that. They why did we get these jokers imported? Or are they legacy issues of Montek and gang?


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