‘Little Master’ of Indian Banking: Y V Reddy (IAS)

‘Little Master’ of Indian Banking: Y V Reddy (IAS)

‘Little Master’ of Indian Banking: Y V Reddy (IAS)

Joseph E. Stiglitz, Professor of Economics at Columbia University and Nobel Laureate, had said ‘If America had a central bank chief like Y.V. Reddy, the US economy would not have been in such a mess.’

Dr. Yaga Venugopal Reddy, better known as Y. V. Reddy (born 17 August 1941) is an Indian Administrative Service (IAS) officer of the 1964 batch who served as Governor of the Reserve Bank of India (RBI) (India’s central bank) from 6 September 2003 until 5 September 2008.

“My best years were in the Reserve Bank of India (RBI), as Deputy Governor and then the Governor. My 11-year-stint was the best period of my career,” smiles the ‘Little Master’ of Indian Banking, Yaga Venugopal Reddy.

An IAS officer and a top ranker, this economics student worked passionately-hard towards being an economist then pursue top bureaucratic positions. “As an officer, you need to have other interests or you could get bogged down. I chose to study economics as it involved mathematics, philosophy and human behaviour,” says the 75-year-old.

Dr. Reddy traces his beginnings from Paturi village in Kadapa district, his education in Telugu medium, college in Chennai, onward to Hyderabad where he was a part-time lecturer in Osmania University, to getting selected to IAS to fulfil the wish of his father, also a civil servant. Eldest in the family, he recalls his days as Collector in different districts under officers like Dr. Abid Hussain, K.R. Venugopal and S.R. Sankaran and the qualities he imbibed. But at heart he was an economist and after a stint in the World Bank, he returned to join the NTR Government as Planning Secretary.

Reddy has worked on piloting a calibrated approach to financial sector reforms. A 19 December 2008 article in the New York Times has credited the tough lending standards he imposed on the Indian banks as RBI Governor for saving the entire Indian banking system from the sub-prime and liquidity crisis of 2008.

Reddy is credited to have played a crucial role in framing macro-economic policies that helped quarantine the country from the domino effect of the financial crisis encountered by the South-East Asian countries during the later part of the 1990s. He, along with Dr. C. Rangarajan, is also credited with the formulation of the course to be steered by the country to come out of the then Balance of Payments crisis.

In the Indian context, he was the first to use the term ‘Financial inclusion in April 2005 in his Annual Policy Statement as Governor of the Reserve Bank of India. Later on, this concept gained ground and came to be widely used in India and abroad.

Reddy was invited to deliver the prestigious The Per Jacobsson Foundation Lecture in June 2012 at the Bank for International Settlements in Switzerland. In this lecture on Society, Economic Policies and the Financial Sector, the main message he gave was that society has put its trust in central banks and as such it expects central bank to ensure trust and confidence in money and finance and serve the interest of the masses

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