May 16: The hardworking Dr. Raghuram Rajan and the story of a gold import circular

This is an article of appreciation for the brilliant Dr. Raghuram Rajan. Here are just three reasons why he is so awesome.


I’m in love. Anyway…

But why today? Well, because it is May 16. Except for the very young, most Indians would remember May 16 as the day the results of the 2014 General Election were announced. There were so many ‘firsts’ that day that it is probably impossible to remember them all.

For the first time in India’s history, a non-Congress government was voted into power with a full majority.

In fact, it was the first ever government to win a majority in the Lok Sabha since 1984!

This was the first time that the Congress Party won less than 100 seats in the Lok Sabha. In fact, they won so few seats that they could not even qualify for the post of Leader of the Opposition.

Indian democracy took a giant leap on May 16, 2014. By mid-2017, the Congress was ousted as the largest party in the Rajya Sabha, for the first time since independence. The Congress monopoly was finally over.

Now where does Dr. Raghuram Rajan figure in all this? Well, because I want to give you an example of what a real “karmayogi” is like. Most people wonder why he is so much better than all of us. Let me show you.

Suffice to say that when May 16, 2014 happened, most mere mortals like us were caught up in the moment. PM Modi was sworn into office on the evening on May 26. For so many of us, it was a ten day period of intense speculation and feverish excitement. A ten day break of sorts when we left our ordinary lives behind and thought of things much bigger than ourselves.

But real karmayogis like Dr. Raghuram Rajan don’t take such breaks. Like the great Arjuna, Dr. Rajan sees nothing except the eye of the bird. Outside of his ‘karma’ and his ‘lakshya,’ the world does not exist for him.


On May 21, 2014, the RBI issued a circular that allowed certain “star trading houses” and “premier trading houses” to undertake certain business activities under the so-called 80:20 scheme.

Only a star like Dr. Raghuram Rajan could have such an eye for stars! When most mere mortals were wasting time watching political drama unfold on TV, Dr. Raghuram Rajan was hard at work. Doing his best for the Indian economy.

Now, you’ve heard of Gitanjali Gems and Mehul Choksi. Like so many messiahs and so many visionaries, Mehul Choksi is a misunderstood man. Any day now, I am guessing that some retired  judge who has joined Congress will tell a court that India has no case against poor Mr. Choksi. Then his critics will look real foolish.

But you know who is really really foolish? People who think they have stuff to teach Dr. Raghuram Rajan.


Look into Dr. Raghuram Rajan’s eyes. Just do it. Can you feel the hypnotizing effect of his supreme intelligence? Do these look like the eyes of a man who would miss out on spotting a threat?

It should be noted that the BJP government scrapped the 80:20 scheme in November 2014. And now the world has been hit by a pandemic. See what happens when we don’t listen to Dr. Raghuram Rajan?

You know who never takes a day off? The Indian Army. But even more than that, Dr. Raghuram Rajan. This nation and its one-eyed economy would be blind without him. Massive, massive respect for you sir!


11 thoughts on “May 16: The hardworking Dr. Raghuram Rajan and the story of a gold import circular

  1. Here is what transpired. Gold imports were first curbed in 2013 to avoid Forex drain after the exchange rates vis-a-vis the dollar slid. Customs duties were hiked for the common man to discourage gold import.

    The 80:20 scheme waived custom duties for select jewellers under the condition that 20% import was re-exported as jewelry. These jewellers got to sell the gold in Indian market at rates that included duty. Since they paid no customs/duty, this cost the exchequer. For fulfilling the 20% export criterion, these jewellers just machine manufactured ornaments like bangles and re-exported to Dubai. No real jobs got created. In other words, money was transferred from exchequer to jewellers from whom those in power must undoubtedly have got a cut

    Apparently the 80:20 scheme cause a loss of Rupees 1 lakh crore to the exchequer and was also used for money laundering. Chidambaram who now and then tweets glorious advice to the BJP government was also in the know.

    Question is why the current BJP government is not prosecuting Raghuram Rajan for this crime

    Liked by 1 person

    1. If 80:20 scheme was signed on 21st May 2014 and that scheme was abolished in November 2014, that means it existed pretty much during BJP rule. Is it possible that even though the jewelers enjoyed this scheme for only seven months, but the cuts from the profit was given to the officials of UPAII government?


    2. The real problem is the one you have raised in the last line – despite all this being known, why has Modi government taken no action in 6 years ? Exactly like nothing has been done against Robber Vadra – even though ED has called hima few times for some chai-samosa chit chat ! Exactly like no effort has been made to move the National Herald case forward, which is gathering dust in some court of some Chhota Mota judge ! Contrast the boldness and commitment of the Raghuram’s & the Vadra’s – with the pusillanimity and indifference of the government that has enjoyed total power and unquestioned mandate for full 6 years ! 😓

      Liked by 2 people

      1. Something called Vendetta Politics. Opposition uses it as a brahmastra and the victimhood. Dont give them any chance and you have a chance to come back and Modi did come back in 2019. We do not know many many things, Raguram might have left but the whole RBI and the beaurocracy is all there, still the same.


      2. The only thing I can say is perhaps in calculating the pros and cons Modi-Shah calculated that not giving sympathy votes to these culprits has bigger pros than cons.


  2. It is also worth understanding why people started buying gold post 2009. The real interest rates (bank interest – inflation) was negative (something like 7-12 = -5%). So those who had slogged and saved were finding the UPA government eating away at their purchasing power and sought refuge in gold.

    Modi government created the gold bonds but it had a fatal flaw that it has a lockin period of 7 years and cannot be redeemed in times of need or when prices are high. Hence it is a big dud.Right now gold duties are at 12 % and interest rates are at 6%. Which means people who buy gold are fore going two years of interest just to keep their purchasing power safe.

    RaGa keeps talking repeatedly about giving cash to people. That seems to be the only trick his economist handlers have taught him. All the economists like Rajan who never worked in industry are communists and have no clue on wealth/job creation. In fact even the word economist rhymes well with communist.

    Yesterday Surjit Bhalla came on Times Now and explained nicely that stimulus means stimulating the economy, not giving handouts.Congress is a one trick hand out pony and is using handouts to rob from the productive class and transfer wealth to itself and its cronies. Cash transfers is just financial genocide of the middle class and working class and wisely Modi government is avoiding that madness.


  3. Add Wikipedia to this list

    Maybe Modi and RW should move to Gab (Twitter can still be used for broadcast)


  4. Offtopic, a report on a Vishnu Murti being found in Bihar. You can see the happiness and pride of the people and apparently people from other villages are visiting this village.

    Bihar has its fundamentals right. Its poverty is just due to bad economic policies and the great developments happening in UP will have a positive impact on Bihar.

    Maybe some of the millionaires in India can spend some of their wealth carving out beautiful murtis like this. If someone wants their efforts to be visible after thousands of years, then such sculptures are the way to go.


  5. The estimated loss to the exchequer was Rupees 1,00,000 Crores due to the 80:20 gold import schedule by Chidambaram-Raghuram Rajan combination. This is not my estimate, it is an estimate by the CAG and and the PAC of Parliament.

    Yet these worthies go around pontificate in front of cameras in press interviews and in a preachy manner offer unsolicited advice to the government!!

    Raghuraman Rajan has coated himself with the same teflon coating that MMS had as PM and nothing is his fault. Its always others who are to be blamed even when they are presiding over the affairs.


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