Malhotra to lead next leg of RBI's war on inflation

The appointment comes months after the govt appointed 3 new members to MPC

- Rajeev Jayaswal, Gireesh Chandra Prasad & Shayan Ghosh

NEW DELHI/MUMBAI: The war on inflation has a new general leading the charge, as India's top revenue officer Sanjay Malhotra moves from North Block to Mint Road. On Monday, the Union cabinet's appointments committee named the 1990 batch IAS officer to lead the Reserve Bank of India, a day before governor Shaktikanta Das leaves at the end of six years at its helm.

Malhotra becomes the latest finance ministry official to steer RBI, after outgoing governor Das, as well as previous governors D Subbarao, Y.V. Reddy and Bimal Jalan. The officials come with a deep understanding of fiscal matters and the pressures on the government, even as they take the reins of India's inflation-targeting central bank.

Malhotra, who currently oversees the Centre's direct and indirect tax administration, will serve for three years beginning Tuesday, the appointments committee comprising Prime Minister Narendra Modi and home minister Amit Shah said. The Rajasthan-cadre officer has previously led the department of financial services and worked across power, mining and information technology.

Like Das, Malhotra will have to deal with stubborn food prices that have pushed headline inflation beyond the monetary policy committee's (MPC) flexible target of 2-6%. In October, inflation as measured by the consumer price index (CPI) was 6.21%, higher than 5.49% in September. The committee now expects retail inflation to soften to 4% only by the September quarter of FY26. Meanwhile, the rupee trades near all-time lows, amid strong demand for the dollar and portfolio outflows.