(Bloomberg) -- India’s government appointed three new external members to the central bank’s committee that decides interest rates, just a few days before a scheduled policy meeting.
The three new monetary policy committee members, who will join three RBI officials on the committee led by Governor Shaktikanta Das, in the monetary policy meeting from October 7-9 include:
- Ram Singh, director at Delhi School of Economics
- Saugata Bhattacharya, economist and fellow at the New-Delhi based Center for Policy Research
- Nagesh Kumar, director and chief executive at the Institute for Studies in Industrial Development
The new members will have a term of four years, according to the finance ministry notice. They will replace the three outgoing external members — Ashima Goyal, Jayanth Varma and Shashanka Bhide — whose term expires Friday.
The overhaul of the MPC comes as a wave of global easing kicks off following half a point cut by the US Federal Reserve last month. Governor Das is also facing calls to cut interest rates as the economy shows signs of moderation.
While inflation was below the target in July and August mainly due to statistical reasons, the RBI expects it to rebound again in September, complicating the outlook for rates. Das has previously said he’s not considering a cut unless price gains stay durably around its target aim. Economists surveyed by Bloomberg predict the RBI will likely ease only in December.
“We think it is too early to take a view on the policy tilt of the new external members. As of now, we see limited merit in changing our view that the first rate cut may come only by December,” said Madhavi Arora, an economist with Emkay Financial Services Ltd. However, a stance change in October is not fully ruled out, she said.
Saugata Bhattacharya is an economist with over three decades of experience in economic and financial markets analysis, policy advocacy, infrastructure and project finance. Prior to his current role, he served as the chief economist at Axis Bank. In his interviews, before becoming a member of the rate-setting panel, he said that inflation trajectory was “manageable” but a room to lower interest rates will open up only in December.
Nagesh Kumar is a well-known trade economist and has previously served as a director at the United Nations Economic and Social Commission of Asia and the Pacific. Kumar has written extensively on India’s approach to building more manufacturing capacity and believes that right policies can help the South Asian nation emerge as a global manufacturing hub.
Ram Singh holds post-doctorate degree in economics from Harvard University, with contract theory, public economics, public private partnerships, and law and economics as key research interests. Singh also taught at the Brown University, University of Hamburg and has been Commonwealth Fellow at the London School of Economics.
--With assistance from Ronojoy Mazumdar.
(Updates with more details from the sixth paragraph.)
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