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The governor of the Reserve Bank of India (RBI), Raghuram Rajan, has alluded to the similarities in the behaviour of Indian cricket fans and economic analysts assessing India’s macroeconomic performance. (Mint, 12 September), However, there is more in common between cricket and monetary policy than the behaviour of their fans.

In the 1970s, it was the justly famous spin quartet—Bishen Singh Bedi, E.A.S. Prasanna, B.S. Chandrasekhar and S. Venkataraghavan—who took Indian cricket to new heights and brought it international recognition.

Two decades later, from the start of nineties up until now, it has been the governor quartet—C. Rangarajan, Bimal Jalan, Y.V. Reddy and D. Subbarao—who have changed the face of monetary policy in India. While they succeeded each other as governor, they have also been working together in different capacities all these years.

Much of Indian cricket’s success can be attributed to the different bowling styles that these bowlers possessed. Bedi was an orthodox left arm spinner, while Chandrasekhar, an attacking leg-break bowler. Prasanna and Venkataraghavan were classic off-spinners. As compatriots, they targeted all kinds of batsmen in the opposition, and giving their captains plenty of options.

In a similar vein, much of the success of RBI can be attributed to the governors’ different styles of monetary management. Rangarajan, the orthodox master of the craft who followed the time honoured tenets of monetary policy, started it all. His marshalling of the monetary artillery will remain a purist’s delight. He set the stage for all successors to perform; just like Prasanna. It is said about Prasanna, and is so true of Rangarajan, that he would think and bowl at the same time. Bedi would think first and then bowl, while Chandra would bowl first and then think.

His successor Jalan, the development practitioner, stumbled into the mecca of monetarism but left behind a rich legacy of policy actions which had life beyond the money markets. He was a statesman-captain who showed that everyone responds almost identically in a crisis. It is during the periods of calm that the governor needs to play a crucial role. For him, routine professional management and not the governor’s performance in a global crisis was more important. He was to RBI what Venkataraghavan was to the Indian eleven.

And, of course, Reddy set new standards in monetary policy activism. He showed that on most days it makes no difference who heads the central bank. What’s important is who heads it on the day when a vast crisis erupts. It is at that point the whole system needs someone to take control and lead the efforts to cope with the crisis. He did it with aplomb during the global financial meltdown. He led from the front, just like Bedi. On a regular wicket, he was not deadly but on the fifth day of a test match on a turning wicket he became unplayable. And he led India to many a victory.

Subbarao, an academic at heart, bowled quite a few googlies at the government at the most unexpected time and in his own inimitable style. He will be remembered for his unpredictable run-in with the finance ministry; exactly like that of Chandrasekhar. After 20 overs of spraying the ball all over the place, he would produce three overs which would put the game on its head. He made the finance minister take the long walk to the pavilion alone.

Just like the spinners performed their best on the dusty sub-continental pitches, governors, too, thrived in monetary management in a closed economy framework. It is quite funny that economic reforms and globalization challenged the quartet of governors exactly as the overseas tours challenged the four spinners. On home turf heroes, but facing a foreign party, be it a cricket team or foreign investors, there was capitulation.

Yet, just like the four spinners contributed greatly to some of India’s greatest triumphs, Test series victories in the West Indies and England, the four governors overcame some serious crisis emanating from the global economy: the 1991 problem, in 1996, the Asian season crisis, and in 2008, the financial meltdown. In all these, India has come out unscathed.

The new governor, Raghuram Rajan, is a break from the quartet tradition, which was marked by a basic underlying distrust of the market and market participants. They were trained to think and were all convinced that the markets are full of deception and distortion and they manipulate individuals and institutions. This will now change.

This is exactly as it happened in cricket. When the spinners were on the wane and the quartet disintegrated, the attack went into the hands of a young fast bowler who rewrote the rules of Indian cricket, Kapil Dev. It was a new idiom for the Indian cricket. It was his cricket that led to the 1983 World Cup victory. It needs to be seen whether Raghuram Rajan can do to monetary policy what Kapil Dev did to cricket.

Haseeb A. Drabu is an economist, and writes on monetary and macroeconomic matters from the perspective of policy and practice. To read Haseeb A. Drabu’s earlier columns, go to
www.livemint.com/methodandmanner-

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