In a revealing podcast episode of ‘Figuring Out’ with Raj Shamani, the esteemed former Reserve Bank of India (RBI) Governor, Raghuram Rajan, disclosed intriguing insights into the financial facets of his tenure, shedding light on his annual salary and the significant perks that accompanied his role.
During the engaging conversation, Rajan, who steered the RBI from 2013 to 2016, emphasized that while his annual salary during his tenure was Rs 4 lakh, the most substantial benefit extended beyond mere monetary compensation. He highlighted the privilege of residing in a spacious house, strategically located near Dhirubhai Ambani’s residence on the prestigious Malabar Hill in Mumbai, as the standout perk of his tenure.
The former RBI Governor delved into the considerable value of the official residence, estimating its potential market value at a staggering Rs 450 crore if put up for sale. He noted that this sizable amount could cover the entire salary of the top echelons of the RBI, indicating the immense significance of this non-monetary benefit.
Comparing his annual compensation to that of the Cabinet Secretary, Rajan explained that despite the salary being on par, unlike government officials, RBI Governors do not receive pensions. This, he clarified, was due to the typical status of RBI Governors as civil servants who already receive pensions from their preceding civil service careers. However, he acknowledged an exception for a former governor who was not a civil servant, underlining the recognition of extensive service to the RBI and the government.
Highlighting the array of perks bestowed upon an RBI Governor, Rajan pointed out the provision of a car and the substantial responsibilities associated with maintaining the sizable official residence. He emphasized the cultural inappropriateness of using a luxury vehicle for official purposes in a country like India.
Post his tenure as the RBI Governor, Rajan resumed his esteemed position as the Katherine Dusak Miller Distinguished Service Professor of Finance at Chicago Booth. Notably, alongside co-author Rohit Lamba, Rajan recently released a thought-provoking book titled ‘Breaking the Mould: Reimagining India’s Economic Future.’ This insightful book, unveiled on December 7, offers a comprehensive exploration of India’s economic landscape, sparking widespread discourse regarding the adequacy of compensation for high-ranking government positions.
Rajan’s revelations offer a rare glimpse into the intricate details and non-monetary benefits associated with occupying a pivotal government role, stimulating discussions on the value placed on such positions and the broader economic future of India.