Rs 2.8 Lakh Salary! What If You Become an RBI Governor?

The position of the Reserve Bank of India (RBI) Governor is one of the most prestigious and influential roles in the country. It not only brings the responsibility of steering the nation’s financial stability but also offers several unique perks and benefits that set it apart from most public-service positions. As the newly appointed Governor, Sanjay Malhotra, will step into this esteemed role on December 11, 2024, succeeding Shaktikanta Das, who served a remarkable six years as the 25th Governor, naturally, one might wonder about the remuneration for this prominent role.

As per reliable sources, the incoming RBI Governor, like his predecessors Shaktikanta Das and Urjit Patel, will receive a monthly salary of ₹2.5 lakh. When allowances are factored in, the gross monthly pay rises to approximately ₹2.87 lakh. While the salary matches that of a government secretary, it is only a part of the overall compensation package, as the role includes several additional benefits.

One of the most significant perks is the official residence provided to the RBI Governor. This is a spacious, luxurious house located in Malabar Hill, Mumbai, one of the city’s most coveted neighborhoods.

Former Governor Raghuram Rajan described the house as “splendid” and noted its exceptional value. He once estimated that if the property—leased from the Port Authority—were to be sold, it could fetch approximately ₹450 crore. Rajan even calculated that the income from such a sale could cover the salaries of the entire RBI leadership. The house is located just a few blocks away from the famous Dhirubhai Ambani residence, adding to its exclusivity.

In addition to the house, the RBI Governor enjoys several other benefits, including a fully maintained car with a chauffeur, comprehensive medical services for the Governor and their family, and post-retirement benefits. While most Governors do not receive a pension because they are already entitled to one from their civil service tenure, exceptions have been made in the past to recognize extraordinary contributions.

Former Governor Raghuram Rajan highlighted the rationale behind the compensation structure during a conversation on the “Figuring Out” podcast. He emphasized that while the salary may seem modest, the role is primarily about public service. Rajan himself chose to return to academia after his tenure, resuming his position as the Katherine Dusak Miller Distinguished Service Professor of Finance at Chicago Booth. He also acknowledged that the Governor’s house was a far greater perk than the salary, underscoring the unique privileges that come with the position.

The role of the RBI Governor is not just about financial rewards but about shaping the economic policies of the nation and ensuring its monetary stability. With Sanjay Malhotra’s vast experience in finance, taxation, and public policy, he is well-prepared to take on this prestigious role, balancing its challenges with its extraordinary benefits.