The government on Tuesday reconstituted the Monetary Policy Committee (MPC), consisting of six members, with three outside members: Ram Singh, director, Delhi School of Economics; economist Saugata Bhattacharya; and Nagesh Kumar, director and chief executive, Institute for Studies in Industrial Development (ISID).
The other three are from within the central bank: the governor, the deputy governor in charge of monetary policy, and an officer nominated by the central board of the regulator.
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The outside members of the committee, appointed by the central government, shall hold office for a period of four years, with immediate effect or until further orders, whichever is earlier, a notification by the Department of Economic Affairs in the Ministry of Finance said.
The new external members have been selected by a six-member search-cum-selection committee headed by Cabinet Secretary T V Somanathan.
Singh holds a PhD in Economics from Jawaharlal Nehru University and a post-doctorate from Harvard University. He has been a fellow at the London School of Economics. In an article published in January 2023 on the government’s tax management strategy, Singh wrote that an investment-rewarding growth strategy requires reducing the regulatory load on corporates and allocating a higher share of tax revenue to fund capital expenditure to improve economic and legal infrastructure.
Kumar, prior to his position at the ISID, served as director at the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) and has held several senior management roles in the organisation. He is a non-resident senior fellow at the Boston University Global Development Policy Center.
A PhD in Economics from the Delhi School of Economics, Kumar was the director-general of the Research and Information System for Developing Countries (RIS), a policy think tank in the Ministry of External Affairs. Kumar has also served on the boards of the EXIM Bank of India, the International Centre for Trade & Sustainable Development (ICTSD), Geneva; the South Asia Centre for Policy Studies (SACEPS), Kathmandu, and as a consultant to the World Bank, Asian Development Bank, among others.
Bhattacharya, an economist with over 30 years of experience in economic and financial market analysis, policy advocacy, infrastructure and project finance, and consumer behaviour, is a senior fellow at the Centre for Policy Research. Prior to this, Bhattacharya was the chief economist and executive vice president at Axis Bank. Earlier, at IDFC, he worked as a specialist with the Policy Advisory Group and participated in several key committees of the Government of India, including the Prime Minister’s Task Force on Infrastructure.
Bhattacharya was part of the RBI’s working group on monetary policy in 2010 and the finance ministry group on estimating foreign savings in 2011.
The Monetary Policy Committee of the Reserve Bank of India (RBI) meets every two months. Its October meeting, scheduled for October 7-9, assumes significance not only because it takes place against the backdrop of leading global central banks cutting rates, but also because the panel will have three new faces.
Markets will keenly watch the new members’ views on both the rate and stance, particularly when there is action on this by leading central banks. The European Central Bank (ECB) did its second rate cut of the year, followed by a 50-basis point cut by the United States (US) Federal Reserve.
The Bank of England and the Bank of Japan maintained the status quo.
RBI Governor Shaktikanta Das has resisted change in both the interest rate and stance, citing volatile food prices and slow progress of last-mile disinflation.
First Published: Oct 01 2024 | 9:18 PM IST
