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Coming back to the current turmoil, actually the resignation of Patel as RBI Governor has elicited sharp reactions from all quarters, so to say.
RBI Governor Urjit Patel unexpectedly resigned Monday, bringing into prominence the role played by the central bank in the country's economy.
The government and the RBI have been fighting for weeks over how much autonomy the RBI should have.
Shaktikanta Das' bureaucratic links are expected to heal a rift between the government and the central bank that had widened sharply under his predecessor, Urjit Patel.
A majority of the 18-member board, now stacked with government nominees, intends to press for reduced curbs on lending and governance changes that would give the board more say.
The governor said the economy would get a boost from oil prices cooling off from four-year highs and asserted that the fundamentals were "robust".
RBI Governor Urjit Patel will be a key focus of the pressure from a group of directors who support the government's position.
The Finance Ministry remained silent on whether it invoked the powers provided under Section 7, which allows the government to issue directions to the RBI in public interest.
Tensions between the RBI and the govt have escalated recently, with the Finance Ministry initiating discussion under the never-used-before Section 7 of the RBI Act.
Support for MSMEs was one among the contentious issues between RBI and the govt leading to the abrupt resignation of previous Governor Urjit Patel last month and the immediate appointment of his successor Shaktikanta Das.
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