Countries must avoid 'copycat' exits: Rajan

RBI Governor Raghuram Rajan stressed that trade, immigration and capital flows must not be hindered.

As Britain decided to leave the European Union, Reserve Bank Governor Raghuram Rajan on Friday said the onus is now on policymakers to ensure there is no such 'copycat' moves in other countries and the idea of "open world" is kept alive by building consensus.

"My sense is that this puts more of the onus on authorities to ensure that there is no anticipation of copycat effects across the world," Rajan told reporters on a conference call from Basel, Switzerland, where he is meeting other central bankers.

The academic-turned-central banker, who has said he would be returning to the academia after the end of his term in September, stressed that trade, immigration and capital flows must not be hindered.

"Authorities across the world will (have to) pay more attention to building popular and political support for keeping an open world," he said, adding that rallying public support would be a "silver-lining" from the Brexit episode.

Brexit has aggravated worries about growing protectionist tendencies and support for ultra-right and conservative politicians in Europe and in the US with the candidature of Donald Trump.

Earlier this week, Rajan had termed the US elections as "fraught with risks", without naming anybody. 

Photograph: Reuters