This refers to the editorial. “It's baptism by fire” (September 6). The new Reserve Bank of India Governor, Mr Raghuram Rajan's rich academic and professional credentials will stand him in good stead in his daunting task of steadying the Indian economy. He has done well on his first day, and the Sensex too has shown some recovery. Mr Rajan knows well that the RBI has a limited role to play to lift a woeful economy, but a change of leadership almost always augurs well for any high office, and the RBI is no exception.
The thrust of the new Governor should be on financial inclusion and strengthening of the rupee. The banking structure requires an overhaul and there is a huge scarcity of banks in India. Mr Rajan has done well by declaring that handing out new bank licences could be on the anvil. He has also taken a positive step by setting up a committee headed by a Deputy Governor to monitor monetary policies. His stress on a strong security market is also very welcome. The next few months will indicate whether Mr Rajan has been able to revive the sinking market.