India’s government has picked three economists from the academic world for a new monetary policy committee (MPC) to set interest rates, as the Reserve Bank of India (RBI) gets ready for a landmark switch in the way it decides policy. They will join RBI Governor Urjit Patel and two senior officials from the bank’s monetary policy department. Patel, who took over the helm at the RBI this month,
will have the casting vote in the event of a tie.
The non-RBI members named are Chetan Ghate, a professor at Indian Statistical Institute; Pami Dua, a director at the Delhi School of Economics; and Ravindra Dholakia, a professor at the Indian Institute of Management in Ahmedabad, in Prime Minister Narendra Modi’s home state of Gujarat.
All are low-profile and India-based, unlike Patel or his predecessor Raghuram Rajan, who had both worked at the International Monetary Fund at one point before joining the RBI.
A former IMF chief economist, Rajan was feted on the global policy circuit, but he rubbed up Modi’s nationalist supporters the wrong way with his blunt social commentary about India.
The ministry did not specify whether the panel would set rates on Oct. 4, the next scheduled RBI policy review, and the first to be held under Patel.
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