Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Industry / Ravindra Dholakia is the govt’s face in monetary policy committee
BackBack

Ravindra Dholakia is the govt’s face in monetary policy committee

Ravindra Dholakia has worked closely with the central government and his expertise on real economy will add immense value to policy making, according to his IIM-A colleague Errol Dsouza

A file photo of Ravindra Dholakia. Premium
A file photo of Ravindra Dholakia.

The short answer may be that he is a dove.

One of the government’s appointees to the monetary policy committee, Ravindra Dholakia has published 47 monographs, 22 books, and more than 140 research papers as a professor of economics at India’s top management institute.

Two of his recent papers offer clues to how he thinks about monetary policy.

In a 2015 paper called How Costly is the Deliberate Disinflation in India?, Dholakia and his co-writer argued that a policy of deliberate disinflation needs to consider the real cost of sacrificing output and employment, particularly when its magnitude is substantial.

In a previous paper released in February 2014 called Cost and Benefit of Disinflation Policy in India, Dholakia wrote about the effects of disinflation on growth.

“The RBI (Reserve Bank of India) governor’s assertion on no serious trade-off existing between inflation and growth in the country does not get any support from recent empirical evidence," he wrote. “On the contrary, deliberate disinflation would impose sizeable immediate cost of loss of output on the system."

“Very broad and conservative estimates of the costs and benefits suggest that 1 percentage point of deliberate disinflation may entail about 1% loss of potential output over short to medium term, and a gain of about 0.5 percentage points in the growth after 4 to 5 years," the paper added.

Under such conditions, RBI should hold nominal growth of money supply and allow supply-side policies by the government to bring down inflation, the paper had said.

Much has changed since Dholakia wrote those papers. India has moved to a new monetary policy framework under which the central bank has to meet a flexible inflation target and a six-member panel, and not the governor alone, takes a call on interest rates.

Dholakia couldn’t be reached on his office landline phone at the Indian Institute of Management, Ahmedabad.

Dholakia is no stranger to government work. He has served on at least 13 government and central bank panels including one that recommended the creation of a postal bank. He has also been a member of the central government’s sixth central pay commission, public expenditure management panel, and the Gujarat government’s state public finance reform committee.

Dholakia’s profile at the IIM-A website lists microeconomics and macroeconomics including policy analysis, economic development and planning including aspects like health, education, labour, regional disparities, energy and input-output analysis as his areas of research.

His colleague Errol Dsouza, a professor at IIM-A, says Dholakia “has worked closely with the central government (and his) expertise on real economy will add immense value to policy making."

Dholakia has served as independent director on the boards of several companies, including state-owned Power Finance Corp. and Gujarat State Petroleum Corp. Ltd. Incidentally, RBI governor Urijit Patel also served on the board of Gujarat State Petroleum (although in an earlier period.) Dholakia was also an independent director at Adani Enterprises Ltd, where he resigned in May as well as shareholder director at Union Bank of India.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

ABOUT THE AUTHOR
Gopika Gopakumar
Gopika Gopakumar has worked for over 15 years as a banking journalist across print and television media. Her expertise lies in breaking big corporate stories and producing news based TV shows. She was part of the 2013 IMF Journalism Fellowship Program where she covered the Annual & Spring meetings of the International Monetary Fund in Washington D.C. She started her career with CNBC-TV18, where she also produced a news feature show called Indianomics and an award winning show on business stories from South India called Up South. She joined Mint in 2016.
Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 23 Sep 2016, 02:38 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App