Raghuram Rajan, the newly appointed Goverbnor of RBI, takes up the hot seat in very difficult times. In the one year that Raghuram Rajan has spent on Raisina Hill, he has gained stature and confidence that few of his predecessors enjoyed. From being an economist he has been slowly initiated into complex issues dealing with political economy. Assuming office in the middle of a serious fiscal crisis, Rajan has a tough job on hands. But he has surprised many with the ease with which he handled an unwieldy fiscal deficit and other pressing economic challenges.
While deciding on demands from Bihar and West Bengal for special status and a debt recast, Chidambaram leaned on Raghu to find a way out. When it came to the core issues, the government always turned to the engineer-turned-economist. The sharp slide in the rupee prompted the government to draft him in as the main firefighter to increase the dollar inflows. Based on his inputs, the government decided to go in for semi-sovereign bonds without ruling out the possibility of India's first sovereign fund-raising. His rockstar-like appeal attracted eager listeners wherever he spoke.