"Dr Raghuram Rajan is... appointed as Officer on Special Duty in the Reserve Bank of India for a period of three weeks prior to his taking over as Governor, RBI on September 5, 2013 to provide for an overlap with the present Governor," the Finance Ministry said.
He has been appointed for a three year term and will succeed D Subbarao.
He is currently serving as Chief Economic Advisor, Ministry of Finance.
Rajan, a noted economist and former chief economist at the International Monetary Fund, will be among the youngest to occupy the high chair at the RBI. He will be 50 years and six months old when he takes over as the 23rd Governor next month.
He will be the first non-civil servant in 10 years to steer the RBI. The previous non-IAS RBI Governor was Bimal Jalan, who had an almost six-year stint that ended in 2003.