Raghuram Rajan: The love story that left India heartbroken

RBI governor Raghuram Rajan bid goodbye. The rupee instantly hit a record low, bonds weakened, Sensex and Nifty did a flip-flop, global investors looked askance, leaders of India Inc tweeted their shock and regret, the government rushed in with FDI plans to absorb the shock, while professional economists weighed in with a disturbing message: good economics does not make good politics, at least in India.

For people like me - who cannot instantly say by how much the current account deficit needs to come down or what sort of balance of payments picture we should have in our next year's Budget - there's a plummeting sense of regret.

But not just. There's also plenty of memories to put a smile on our collective faces.

For, let's admit it, India has had a love affair with Rajan - ever since, the 50-year-old IIT-IIM-Ivy League-IMF economist became the 23rd governor of RBI in 2013.

The "Rajan Effect"

When Rajan took over, India was staring at an incipient balance of payments crisis. But the "Rajan Effect" turned the country's mood upbeat: Sensex and Nifty surged, the rupee strengthened.

Also read - Why there's no need to be emotional about Rexit

Industrialist Anand Mahindra called him "the new broom," financier Naina Lal Kidwai considered India "fortunate" to have him, technocrat Montek Singh Ahluwalia reiterated, "lucky to have him," former RBI governor Bimal Jalan said, "He is extremely experienced and an excellent economist."

And the everyday Indian took to social media: "New term in economics. The Raghuram Rajan Effect. Stock market surging. Rupee strengthening. Reappoint him every day."

A mood of expectation, however absurd, hung in the air that "the rupee (would) soon be equal to 100 dollars."

Nation had a crush

It was love at first sight. The inimitable Shobhaa De showed the way, by making a startling comparison: "Raghuram Rajan is the Ranbir Kapoor of banking."

Pink papers, known for their stolid headlines, suddenly (to put it bluntly) freaked out: "Name's Rajan, Game's Bond."

Social media went into an overdrive of oohs and ahs: "They say Raghuram Rajan is so good-looking, the US dollar will fall for him," tweeted someone. "Ninety five per cent girls' understanding of economics: 'Awww! Raghuram Rajan is so cute'," posted another.

"When Gandhi sang Raghupati Raghav Rajaram, he actually meant tht 1 day a man called Raghuram Rajan will sign next 2 his pic on currency notes," posted yet another.

Parody Twitter accounts came up in his name, as did Tumblr blogs, tracking every syllable he uttered and every expression he sported. "Like air travel and mobile phones, now everyone has a crush on Raghuram Rajan," summed up a business reporter.

Rockstar banker

From "Messiah on Mint Street" to "Monetary Heart-throb" - no other RBI governor has ever received as much adulation as Rajan did in just 2.9 years, if ever.

The Indian state has traditionally neglected its central bankers. Even though at the top of the financial system, they are left to "operate in anonymity". As Kishori J Udeshi, former deputy governor of RBI once said, they live "staid and boring" lives, isolated from the public eye, and the nation never gets to know them well.

To quote former RBI governor YV Reddy: "A central banker is neither fish nor fowl, neither an academician nor a banker." Rajan has been the only exception.

What is it that we don't know about him? We have talked incessantly about his "photogenic appeal," his "casual manner," his penchant for tennis and squash, his love for Tolstoy and Tolkien, for quizzing and marathons, his wife (whom he met at IIM-A), their children, his siblings, his "Tambrahm" roots, his lack of academic arrogance… and, of course, the high-voltage political battle he has been waging since 2014.

And so long

Like all good things, that love story, too, has come to an end. "If anyone can resist the political pressures that central bank governors face, it will be Rajan," economist John Cochrane of the Chicago Booth School said in 2013 - a prescient comment that we have not had the attention-span to notice. Rajan, it seems, has fallen foul of the current political climate.

"No central bank governor has had to face the sort of personal attacks that Rajan has been subjected to," writes an editorial in Mint.

But India has not let him down: over 60,000 citizens have signed an online petition asking Prime Minister Narendra Modi to extend Rajan's tenure. About 250,000 Indians are following him on social media.

Also read - By getting Raghuram Rajan out, Modi may have won, but India has lost

In an Economic Times poll, 90 per cent Indians want him as RBI governor again; an equally strong majority do not believe that Rajan has "destroyed the economy" and "increased unemployment" by refusing to cut interest rates - as propagated by his detractors.

At the end of the day, who cares for the kitchen-sink style politics of people on the roll-call of political parties, who can say anything - no matter how base, gross, false, inconsistent or contradictory - and do anything to win?

Winning the war is just half the battle. What's harder is winning hearts. Going by that, Rajan is definitely having the last laugh.