Book Review

Written By 23rd Governor of Reserve Bank of India.

Raghuram Govind Rajan (One of the Top 10 Economists

of the world in 2003)

Topic- Book Review on “I DO WHAT I DO”

Name- Sagar Talla
Roll no- 2019-I-123

1|Page
 Who is Raghuram Govind Rajan?

Raghuram Govind Rajan is a world-class Indian economist who has also served as the twenty-
third Governor of the Reserve Bank of India. He also serves as Eric J. Gleacher Distinguished
Service Professor of Finance at the Booth School of Business at the University of Chicago. Rajan
is also a visiting professor for the World Bank, Federal Reserve Board, and Swedish
Parliamentary Commission. He formerly served as the president of the American Finance
Association and was the chief economist of the International Monetary Fund (IMF). He won the
Fisher Black Prize awarded by the American Finance Association.

In 1985, he graduated from the IIT, Delhi with a bachelor's degree in electrical engineering, and
he completed his MBA at the IIM, Ahmedabad in 1987. He received a PhD in management from
the Massachusetts Institute of Technology (MIT) in 1991 for his thesis titled "Essays on
Banking"

Introduction
2|Page
"I Do What I Do" is a collection of former "RBI Governor”, Raghu Raman Rajan's speeches and
articles. It is divided into three sections - The first and longest called RBI days consists of
speeches during his tenure as RBI Governor from 2013 to 2016. The second part has his
prescient predictions of the 2008 crisis - Rajan was one of the few global economists to have
seen it coming - and from the period after the crash, suggesting possible ways to prevent the
recurrence of similar systemic failures. The third part contains his articles covering other topics
in economics. As the author explains in the introduction, this is not a tell-all book. He had the
decency to wait for a year after the controversial end of his tenure to publish the book so that it
would not come in the way of his successor's work. The speeches were made partly with the
objective of spreading financial and economic literacy. In this, Dr. Rajan, the economics
professor, does a remarkable job. In each of his speeches or essays, he lays out the broad outline,
explains the points in detail and concludes his points in a clear and logical manner. Even
someone with only a basic knowledge of economics could follow his speeches because of the
brilliant clarity of his writing. The book gives an idea of how he set RBI policy with great
foresight and in spite of the various pressures he had to face. The Indian economy is still
benefiting from some of the measures he pushed through, such as forcing banks to recognize
NPA's and setting a framework for controlling inflation.

What Raghuram Rajan Did as a Governor.

3|Page
#1. Rajan’s most visible achievement during his term as the RBI governor is reigning in
inflation.
#2. His term saw two repo rate increases which totaled to 50 basis points. This helped inflation to
drop from 11.5% at its peak to 3.3% in November 2014.
#3. Then came by, five repo rate cuts aggregating to 150 basis points. He left rates unchanged at
6.5% at Tuesday’s meeting.
#4. Rajan initiated Swachh bank exercise – clean-up of the bad loans in the banking sector,
particularly public sector banks.
#5. He made way for the banking structure reforms by allowing entry of small finance banks &
payments banks.
#6. As he leaves, he could be the last RBI governor to have decided on monetary policy.
Henceforth, policy decisions will be vote-driven rather than being directed only by the governor.
#7. RBI will set a formal inflation target with a casting vote for the governor in the forthcoming
policy reviews.

Why Raghuram Rajan Stepped Down?

 Governor Rajan’s monetary policy view
 Conflict with fiscal authorities
 Erosion to RBI’s policy independence
 Central bank policy independence

Impact of Raghuram Rajan's Exit.

 Currency Outflow
 Change in Inflation
 Change in RBI's Policies
 Change in Interest Rates

4|Page
My Initial take on the book – Conclusion

 A Bunch of well-arranged speeches, He tries to explain the rational, the well thought
mechanism behind his every decision during his tenure as the RBI Governor. He makes it
clear that, all his speeches are written by himself though eventually edited to avoid any
political controversies before delivering them.
 He makes it very clear from the beginning that, his speeches well guided and a collective
team effort. The title of his book is derived from one of his sensational answers to media or
the in Rajan's words the media made them sensation, made them headlines in the next day
newspapers and pushed the policy to center pages.
 Right from the second page, his use of the word 'We' clearly states his nature and method of
work. One of the most prominent of his works as RBI governor is reduction in Inflation but
he gives most of the credit to 'Dr Urjit Patel' Committee (The Current RBI governor).
 If this book fails to change your opinion on Mr. Rajan, it will surely change your opinion on
Dr. Urjit Patel, which is definitely a favorable factor for the credibility for RBI and thus the
stability of Indian Economics.
 Over the end he does accept that, there was no offer from Government for extension of
tenure, which is a very general and normal thing to happen and had happened many times in
the past. He doesn't rule out the possibility to return back to Indian Economics in some power
in near future.
 The book takes you back to year 2014, when Indian Economics and India are relatively in
turbulent state. He explains various issues, his thought process and the decisions taken by use
of his speeches made during those instances. A very well-crafted book.
 He explains lots of Economic concepts, but I suggest pick this book only if you know at least
about 'E' of the 'Economics' and if you have a keen interest to know about the past economic
events. Else, mostly for Educational purposes and economics and finance.
 He tries to cover various issues right from the reforms related to inflation, Banking sector,
debt markets, Financial inclusion, Resolution of Distress, Advice on Macro Economics,
Some broad concepts like Democracy and Rule of law, Tolerance and Respect! The book
holds some messages on the event of RBI's 80th Anniversary and India 67th Independence
Day celebrations.

5|Page