All-rounder Patel has business acumen

After we recruited

Urjit

Patel at

IDFC

, we worked together for nine years. I think his appointment as RBI governor is an excellent choice as it will bring stability and there will be no uncertainty. In any Indian company, or even a multinational, I have noticed over the decades that 9 out of 10 times, an insider is preferred to a new person to avoid disruption. Even in our company if we have a good candidate, we prefer to look inside.

Urjit has the experience of the public sector — he has worked in the government and the finance ministry. He has worked in startup infrastructure financing. He was the main person helping the government form policies on roads, airports, ports, power and telecom — the last two being his speciality at IDFC. We have sat together on many committees, including those headed by Arun Shourie, Jaswant Singh and George Fernandes.

In the years at IDFC, he showed

business

instinct and

acumen

and is extremely strong in infra policy. Later, he was elevated to the

board

of IDFC and has seen how the core sector works. He has also served on the boards of SBI and the National Housing

Bank

and knows how banks function.

Patel has seen from the other side the difficulties in infra funding. India’s biggest problem today is lack of infrastructure. And the biggest banking problem is that infra loans that banks have advanced are turning bad. Patel has experience on all sides — lending, recovering, policy and now as a regulator.

Younger people becoming governors is a very good trend, which Prime Minister Narendra Modi and the finance ministry have continued. Raghuram Rajan was 50 when he was named the governor and Patel is also in his early 50s. A younger person will always be more energetic than a retired individual becoming the governor. And you cannot dispute Urjit’s qualifications — Oxford, University of London, and University of Yale.

Until now, Patel was handling one part of the RBI. His job did not require him to meet many bankers, which might have made him come across as aloof. Now he has to oversee and supervise four deputy governors. His job broadens significantly and it is not just monetary policy anymore. He is a bit reserved but approachable and accessible.

Rajan has initiated several policies in the last three years — new full-fledged, small and payments banks, opening up the banking system, getting ready for Basel III, recapitalization of banks, handling forex astutely — and all that would evolve under Patel.

(As told to Mayur Shetty)


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