The Centre for Social and Economic Progress (CSEP) hosted a seminar titled ‘An Innovative and Superior Interest Rate Policy’ on Tuesday, July 29, 2025.

The seminar featured a discussion between Gurbachan Singh, Independent Economist, Renu Kohli, Senior Fellow, CSEP and Janak Raj, Senior Fellow, CSEP.

About the event

The central bank often uses the interest rate as its main policy tool. However, the prevailing policy is very blunt; it has serious adverse side effects for interest incomes, asset prices, banking stability, short-term funding, international capital flows and exchange rates. Also, the policy of lowering or raising interest rates is not meaningfully effective in maintaining macroeconomic stability, which is the main stated objective. The policy is also, in an important sense, large-sized and non-transparent. All this motivates a reconsideration of the basic principles and policy. This paves the way to an innovative policy intervention that is, by and large, superior to the prevailing policy intervention. The proposed policy intervention includes mainly a new interest rate policy.

Presenter

Gurbachan Singh

Gurbachan Singh is an independent economist. He was previously a visiting professor at Ashoka University. He has taught at the Indian Statistical Institute (ISI), Delhi, and Jawaharlal Nehru University. His main area of research is at the interface between macroeconomics and finance. He is also actively working on the Indian economy; this is mainly on the macro-financial aspects. One particular area of interest is the price of land. Besides academic journals, he has been publishing regularly in Business Line, Business Standard, and Ideas for India. He is the author of the book, Banking Crises, Liquidity, and Credit Lines – A macroeconomic perspective (Routledge, Abingdon, 2012). He has been working for a while on his new book, Macroeconomics and Asset Prices – Thinking Afresh on Basic Principles and Policy. He received his PhD from ISI (Delhi) and MA from Delhi School of Economics.

Discussants

Renu Kohli

Renu Kohli is an economist with research and practitioner experience on macroeconomic policies and issues. She has previously worked with the RBI, the IMF and thinktanks including ICRIER and the Institute of Economic Growth. Her work has focused on financial sector liberalisation, capital flows and exchange rate management in emerging markets with special India focus, international macroeconomic coordination, and recently, the macroeconomic impact of decarbonization in India. She has been published in refereed journals such as the Review of Development Economics, Journal of Development Studies, Journal of Asian Economics, Oxford University Press, IMF Working Papers, RBI Staff papers, and contributed to edited volumes. She has exposure to multilateral surveillance including Article IV missions; as short-term expert with IMF Institute, her training missions include courses on financial programming & policies and macroeconomic diagnostics. Dr Kohli has wider engagement with the private financial sector and investors through talks, presentations and consultation on Indian macroeconomic policies. She also serves as an independent director on the board of NCML Ltd and NFIN.

Janak Raj

Janak Raj is a Senior Fellow and leads the macroeconomic segment in the Growth, Finance and Development vertical at CSEP. He also works specifically on inter-linkages between economic growth and human development, fiscal federalism in the health sector, climate finance and multilateral development banks (MDBs) reforms. He is currently also a member of the JM Financial Centre for Financial Research of IIM Udaipur. He has more than four decades of work experience, including in the Reserve Bank of India, the International Monetary Fund (IMF) and Ministry of Finance (Department of Financial Services). Janak Raj served as an Executive Director in the Reserve Bank of India and as a member of its statutory Monetary Policy Committee (MPC). He also served as Principal Adviser of Monetary Policy Department and International Department of the RBI and headed its Department of Economic Policy and Research. At the IMF, Washington DC, he was Senior Advisor to the Executive Director for Bangladesh, Bhutan, India and Sri Lanka. He served as an RBI nominee director on the Governing Board of the BSE (formerly Bombay Stock Exchange) and as a Senior Consultant in the Department of Financial Services, Ministry of Finance. He holds a PhD in Economics from IIT Bombay.

All content reflects the individual views of the speakers. The Centre for Social and Economic Progress (CSEP) does not hold an institutional view on any subject.

Please contact Manmeet Ahuja at MAhuja@csep.org for general queries and Ayesha Manocha at AManocha@csep.org for media queries.