The government on Tuesday appointed three new external members—Ram Singh, Saugata Bhattacharya and Nagesh Kumar—to the Reserve Bank of India’s (RBI) monetary policy committee, a move just in time for the next meeting of the rate-setting panel on October 7.
The new members of the MPC would hold office for “a period of four years, with immediate effect or until further orders, whichever is earlier”, the government said. With this, the current external members of MPC—Ashima Goyal, JR Varma, and Shashanka Bhide—cease to be on the panel. Their tenure was to end on Friday.
Among the new members, Singh holds a doctorate in economics from Jawaharlal Nehru University and a post-doctoral degree from Harvard University. His areas of expertise include public economics, taxes and public finance, law and economics, banking and financial regulations and Indian economy. Singh has over 20 years of experience in teaching, research and publishing.
Bhattacharya is an economist with over 30 years of experience in economic and financial markets analysis, policy advocacy, infrastructure and project finance, consumer behaviour and analytics. A regular writer of columns including for FE, he is currently a senior fellow at the Centre for Policy Research. Before joining CPR, he was the chief economist and executive vice-president at Axis Bank.
Kumar, who holds a doctorate in economics from Delhi School of Economics, is known for his expertise in international trade policies.
Currently, chief executive of Delhi-based Institute for Studies in Industrial Development (ISID), and non-resident senior fellow at Boston University Global Development Policy Centre, he earlier served as director at the United Nations Economic and Social Commission of Asia and the Pacific (UNESCAP). In the UN body, he had previously held several senior management roles, including as chief economist, director of macroeconomic policy and financing. At ESCAP, he was heed of south and south-west Asia office. Kumar was director-general of the Research and Information System for Developing Countries (RIS), a policy think tank under the ministry of external affairs.
The MPC consists of six members: three from RBI itself, including the governor who heads the panel, the deputy governor in charge of the monetary policy, and another official, typically the executive director of the central bank’s monetary policy department.
Governor Shaktikanta Das’s tenure — already extended once by three years — comes to an end on December 9 and deputy governor Michael Patra’s term ends on January 14. It is not yet known whether they will get further extensions.
The external MPC members who end their terms next month have been more dovish than their RBI counterparts in recent rate meetings. Both Goyal and Varma voted for rate cuts in the past two meetings. Bhide raised concerns about the impact of high rates on economic growth, even though he voted in line with RBI officials.
A selection panel — currently led by Das, Cabinet secretary TV Somanathan and economic affairs secretary Ajay Seth — recommends the names of the external MPC members to the government for approval.
The US Federal Reserve’s interest rate cut after a gap of four years has opened the way for rate cut by Asian countries including India, but a conservative RBI may not be in a hurry to cut interest rates in 2024, Jefferies’ global head of equity strategy Chris Wood said recently.