In a surprise announcement, India has appointed career civil servant Sanjay Malhotra as the new governor of the Reserve Bank of India (RBI), replacing Shaktikanta Das. The decision comes as the country grapples with slowing economic growth and rising inflation, creating uncertainty in financial markets.
Malhotra, who currently serves as revenue secretary in the Ministry of Finance, brings over three decades of experience in financial services, taxation, power, and information technology. His three-year term as RBI governor begins amid pressing challenges, including navigating a sharp growth-inflation trade-off and adapting to a volatile global economic environment.
Markets had widely anticipated an extension of Das’s tenure, making Malhotra’s appointment unexpected. The transition has raised concerns about potential shifts in monetary policy, especially with the likelihood of further changes in key leadership roles at the central bank.
“A new governor, coupled with the possibility of a new deputy governor for monetary policy before February’s policy review, adds a layer of uncertainty for markets,” said Madhavi Arora, chief economist at Emkay Global.
Malhotra steps into the role at a pivotal time, with inflationary pressures challenging growth prospects and global economic conditions adding to domestic complexities. Financial analysts and policymakers will closely watch the new governor’s approach to stabilizing the economy and steering monetary policy.
