A search committee is to screen and choose the next chief for Reserve Bank of India, or RBI, an occasion likely to be appointed for the first time, according to people familiar with the development. Having faced many brickbats during his term, something not unusual for an RBI chief, Raghuram Rajan's conservative stance has led people to believe he is negligent and inconsiderate of the government's concerns. Finance ministry officials were frustrated by his reluctance to reduce interest rates to aid in growth, and therefore decided to ease him out of his job. However, this does not mean that Raghuram will not be missed. Several parties are in favor of a second appointment of Raghuram Rajan.
Raghuram's re-appointment can be due to the leaning in of Prime Minister Modi. Modi and Rajan have developed a close working rapport, and that this could infuse more funds into the $2 trillion economy.
Foreign investors are more keen on Raghuram steering through the economy and this will lead to them investing more in the economy. They will put more funds, read trust, into someone who has proven themselves in the coveted position.
Therefore, in the end, its not the leaders but the policies that matter. Raghuram's reluctance to be swayed in by the pressures of businesses and ministries has been severly looked down upon. However, his policies have also lead to millions being invested into the debt market by foreign investors.
Come September, India will either re-welcome Raghuram or adjust their investments accordingly to the new policies. Both sides of the coin are shining, whether it is to stay with a proven leader or to go with someone who stirs up the economy with lower interest rates.