Our RBI governor got caught in a tough spot when lecturing a group of students in Mumbai,India recently. The kid Raja asked him a question that couldn’t have come at a more opportune time, considering India’s current economic scenario.
Referring to the fact that the mere rumour of the US gearing up to cut down the “Federal stimulus” brought down the rupee’s value considerably, the schoolboy asked the RBI governor when we will see an Indian policy affecting other countries so intensively.
Though the Central Bank governor was pleasantly surprised with it, he braced himself and answered it with a smile. Raghuram said that by the time Rajas is “old enough to get a job, India will be a significant force in the world economy. We are a country that has kept its borders relatively opened and is opening up even more. So, flows in and out will be important and will have a lot of influence on the world.”
Rajan further added that by the time Raja is in his age, India would have become “one of the two or three great economies in the world and US Central Bank governor will have to decide the kinds of policies that are appropriate for the world and not just India at that time.”