Three-year term short for RBI governor: Rajan

New Delhi, June 30: Reserve Bank of India governor Raghuram Rajan, whose three-year term comes to an end in nine weeks, on Thursday pitched for a longer tenure for the central bank head, saying the global practice has to be emulated in India as well.

Rajan, who briefed Parliament's standing committee of finance on various aspects of the economy and NPA in banks, was asked by members on what should be the tenure of the RBI governor, sources said. He told the members that a three-year term is "short".

On whether it should be five years, Rajan is believed to have cited the case of US Federal Reserve, where in addition to serving as members of the board, the chairman and vice-chairman serve terms of four years.

Rajan, whose current threeyear tenure ends on September 4, has already said no to a second term.

Sources said during the meeting that lasted for more than three hours, the governor briefed the panel, headed by senior Congress leader M Veerappa Moily, on the state of the economy, reforms and restructuring of RBI, challenges in the banking sector.

The committee was apprised by Rajan of the various steps taken to deal with the bad June 30: The process to set up the monetary policy committee (MPC) is ongoing and it is not clear if it will get to set interest rates at the central bank's next policy review on August 9, Reserve Bank of India (RBI) governor Raghuram Rajan said on Thursday, according to TV channels.

The government is in the midst of putting in place a six-member monetary policy committee that will be tasked with deciding interest rates. Reuters loan problem, said sources.

Rajan, sources said, also briefed members of Parliament about the credit scenario of the banks. He is believed to have told the MPs that private lenders are more active on the lending front, but PSU banks are found to be reluctant even when there is no shortage of funds. He also explained to MPs the impact of Brexit on India and the global economy.

Earlier in the day, Rajan called on finance minister Arun Jaitley as the central bank and the government seek to quickly put in place a new interest ratesetting mechanism. PTI