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Rajan stresses need for independent institutions with public credibility

Reserve Bank of India (RBI) governor Raghuram Rajan on Friday stressed on the need for independent institutions with public credibility and confidence in the country. “We need independent institutions with public credibility and confidence that these institutions will deliver on their mandate,” said Rajan at the Twelfth Convocation of Indira Gandhi Institute of Development Research.

Rajan pointed out to a study which argues that it is not resources, it is not people but it is good solid institutions that are the key to sustained economic growth.

The Prime Minister said recently that banks would be run professionally, and there would be no interference but accountability was essential. He said the government had no vested interest and public sector banks can derive strength from this act. “The statement by the government the other day that banks will be free from interference is a landmark statement which essentially seeks to protect strong commercial decision making by the banks from political interference,” said Rajan.

Meanwhile, at the convocation Finance Minister Arun Jaitley was also present who welcomed the phenomena that these days the proportion of girls are increasing in educational institutions as earlier sending a girl to school was a big challenge.

“These days it is not the degree alone or your capability but also the prestige of the institution from where you get the degree which adds to you stature and ability,” said Jaitley while addressing the convocation.

Earlier in his life Jaitley had spent a term as the guest of the state in jail during the emergency for standing out for his political beliefs. “You should draw inspiration from such principled career,” Said Rajan to the students present at the convocation.

The Swachh Bharat Abhiyan has been a success as it received a wide support. “It is just not physical cleanliness but mental cleanliness, intellectual cleanliness and spiritual cleanliness. The notion that if 120 crore Indian come together with a focus on public spirit and public work, there is no force on earth which can stop us from what we need to do,” said Rajan.

Economic issues are gaining importance in the country. According to Jaitley after the Modi government took over and a series of steps were started, a large part of the parliamentary time, the government’s energy and the cabinet’s time is being consumed debating not so much of political issues, but substantially the government’s issues which almost gets directly related to economic issues.

Jaitley also encouraged suggestions of students for evolving institutions into a  think tanks. “India deserves to have think tanks literally in hundreds in almost every spear of activities,” said Jaitley.

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