Lessons from RBI and CBI
Losing heads of the institutions shows carelessness by the govt
Acountry is judged by the quality of its people and its institutions, which is why recent events in India regarding the Central Bureau of Investigation (CBI) and the Reserve Bank of India (RBI) are disturbing. In both institutions, the current Bharatiya Janata Party-led National Democratic Alliance government appointed leaders of its choice (fine, second choice in CBI, because its first choice wasn’t eligible at the time the vacancy came about). Neither Alok Verma at CBI, nor Urjit Patel at RBI was the appointee of an earlier government that the current regime had to tolerate. Yet, in both institutions, the leaders rapidly fell into disfavour with the government.
In Mr Patel’s case, this seems to have been driven by a fundamental difference of opinion on how the economy should be managed and the extent of the central bank’s autonomy. Expectedly, he resigned late last year citing personal reasons. The government’s unwillingness or inability to convince Mr Patel to stay back remains a mystery. It will serve as the filter through which any decision of the new governor and a new committee to look into issues where the bank and the government have a different view is seen. Mr Verma’s case is more complex. He and his deputy (the man who would have been the government’s first choice) were allowed to squabble, make allegations against each other, and then abruptly divested of their powers. Since due procedure wasn’t followed during his removal, the Supreme Court insisted that the decision be reversed, and reinstated him. Late last week, he was removed again, this time following due procedure, but several questions remain unanswered. These concern the nature of charges against Mr Verma, and the quality and methodology of the Central Vigilance Commission’s probe.
Earlier governments might have also been interfering in their management of institutions but that’s really no defence for the lack of transparency and the unwillingness to go the extra mile in explaining what went down in these important organisations. No government, especially not one that continues to remind the country of how previous governments eroded the autonomy of institutions, can afford that. To lose one head of an institution may be a misfortune; to lose two looks like carelessness.