Raghuram Rajan is the first RBI governor since 1992 not to seek a second term as India's central bank boss.

Highlights RBI Governor Raghuram Rajan's term ends on September 4

Dr Rajan is first RBI governor since 1992 to not seek a second term

RBI chief has faced opposition for not lowering interest rates enough

"I want to share with you that I will be returning to academia when my term as Governor ends on September 4, 2016," said Dr Rajan in a press release addressed to the staff of RBI

53-year-old Dr Rajan is the first RBI governor since 1992 not to seek a second term as India's central bank boss.

Finance Minister Arun Jaitley said that the government "appreciates the good work done by him and respects his decision". Dr Rajan's successor would be announced shortly, he added.

Former Finance Minister P Chidambaram, instrumental in appointing Dr Rajan as RBI chief in 2013, said he was "disappointed and profoundly saddened" by the decision.

"As I had said some time ago, this government did not deserve Dr Rajan. Nevertheless, India is the loser," he said.

The RBI chief's decision not to seek a second term comes at a time when he had come under a vicious attack from BJP lawmaker Subramanian Swamy, who had accused Dr Rajan of an "apparently deliberate attempt to wreck the Indian economy". Mr Swamy had contended that the RBI governor is "mentally not fully Indian" since he continues to renew the Green Card issued to him by the US government.

In an exclusive interview to NDTV earlier this month , Dr Rajan had said that he "welcomes genuine criticism of our policy but will not address ad hominem attacks" or allegations against him as individual rather than the policies and position he holds.

Dr Rajan had also hinted that he may not be interested in a second term.

"I won't comment on a second term. But you've seen my speeches. My ultimate home is in the realm of ideas," he had said.

Dr Rajan, a former chief economist at the International Monetary Fund (IMF), has been popular with foreign investors who cheered his efforts to lower inflation and clean up state-run banks' massive bad loans.

Raghuram Rajan on Saturday said he would not be seeking a second term, ending months of speculation about his future as Reserve Bank Governor. Dr Rajan put out a statement today saying he plans to return to academia when his term ends on September 4.