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Harsh Vardhan
Dr Harsh Vardhan is a management consultant and researcher based in Mumbai.
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Of twists and turns: Monetary policy and ‘term premium’
As India’s economic growth slowed down in recent years, the reliance on monetary policy to stimulate growth increased significantly – especially during the pandemic. Analysing data from 2018-2020, Rajeswari Sengupta and Harsh Vardhan show that conventional and unconventional monetary policy actions of the RBI have had only a modest impact on the ‘term premium’ – an indicator of the market’s expectations of future interest rates. This points towards the limits of monetary policy actions alone as economic stimulus during a crisis.
Covid-19 crisis: Response should not undermine institutions
The unprecedented economic crisis triggered by the Covid-19 pandemic has resulted in calls for drastic actions on part of the government and RBI. In this post, Sengupta and Vardhan content that these actions often entail – explicitly or indirectly – undermining or even overriding established frameworks and institutions of policymaking. In their view, this approach is ineffective and unsustainable, and can be dangerous for India’s medium- to long-term growth prospects.
The pandemic and the package
The government has announced a package of fiscal and monetary policy actions, and broader economic reforms to set the economy back on track after the Covid-19 lockdown. In this post, Sengupta and Vardhan argue that instead of announcing many small-ticket items that further complicate matters of targeting and delivery, the package could have been split into two main parts: partial credit guarantees and direct lending programmes for targeted micro, small, and medium enterprises; and direct benefit transfers to low-income households
Financing the climate transition of India’s power sector
A cornerstone of India’s climate transition plan is to shift towards a high-efficiency, low-emission power sector. In this post, Vardhan and Tilotia outline the investment and financing challenges associated with such a shift, by consolidating existing projections under various scenarios for the power sector, and assessing these against available financial resources. Further, they examine policy options that could enhance the flow of capital into such investments.