Eurozone crisis to be over by September: RBI
If RBI Governor D Subbarao's prediction is anything to go by, the Eurozone crisis is likely to be over with expiry of his term in September this year.
New Delhi: If RBI Governor D Subbarao's prediction is anything to go by, the Eurozone crisis is likely to be over with expiry of his term in September this year.
The global crisis and Eurozone crisis will end with the expiry of my term as RBI governor, Subbarao told his fellow alumni of IIT Kanpur in a lighter vein Sunday.
"People ask me when is this global financial crisis that is reeling for the last five years will be over. I have never answered the question but I am going to give the answer today," he said.
The RBI Governor, a 1972 batch IAS officer, said, "I was appointed Governor on September 5, 2008 and two weeks later the Lehman Brothers collapsed ... So there was an association with Subbarao becoming the Governor and the world economic crisis."
Subbarao further said, "So my term was initially for three years. So people thought when my term will be over, the crisis will be over because there was a co-relation between Subbarao and financial crisis."
And then in August 2011, he said the government renewed his term for two more years.
"And two days after that Eurozone crisis happened. So again it established a co-relation. So, that is why eurozone crisis and the global crisis will be over when my term comes to an end," he said.
"Among group of friends and well wisher, I thought I should give exclusive answer (on when the global economic crisis will end)," he added.
Subbarao term as Governor of RBI comes to an end on September 4, 2013.
Financial services firm Lehman Brothers had filed for Chapter 11 bankruptcy protection on September 15, 2008, triggering the global financial meltdown.
The filing remains the largest bankruptcy filing in the US history, with Lehman holding over USD 600 billion in assets.
Subbarao known for witty remarks had earlier also created ripples of laughter when he had linked his receding hairline and the high rates for hair cut to make a point on spiralling inflation.
He had said that he used to pay Rs 25 for a haircut 20 years ago which went up to Rs 50 even as his hair thinned. However, in recent times, though the hair growth has been almost nil, he is paying Rs 150 for a haircut.
"Now when I have virtually no hair left, I pay Rs 150 for a haircut," the career bureaucrat-turned-central banker said to a laughter from the audience comprising a top official from the European Central Bank's statistical department, many academics from the field of statistics and economic analysts.
Also last year at a banking conference he had used his wits to play down the CRR controversy between his senior most deputy (KC Chakrabarty) and the nation's largest bank SBI.
"I have an important announcement to make. Late last night I signed off a paper forming a committee. The terms of reference for the committee are whether we should continue with CRR or not. Members of the committee are Dr Chakabarty and Shri Pratip Chaudhuri.
"Process of the committee will be that both of them will be locked up in a room until they reach a conclusion and the time frame is that they will not submit their report till my term as governor is over," Subbarao told the audience in a lighter vein.
After the speech, when asked if he was serious or joking, Subbarao retorted: "What do you think?"