India’s Rockstar Central Banker Defeated as Modi Revolution Stalls

India’s financial prophet Raghuram Rajan has lost a power struggle over monetary policy, an ill omen for the country

by Ambrose Evans-Pritchard

India’s bid to become the ‘economic super-tiger’ of Asia is in serious doubt after an assault on the independence of the central bank and failure to deliver on promised reforms.

The country has been the darling of the emerging market universe since the Hindu nationalist Narendra Modi swept into power in May 2014 promising a blitz of Thatcherite reform and a bonfire of the diktats, but changes have been blocked in the legislature. The government has turned increasingly populist.

Matters have come to a head with the de facto ouster of Raghuram Rajan, the superstar governor of the Reserve Bank of India (RBI), rebuked for keeping monetary policy too tight.

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