Meghnad Desai was a gloriously transformative economist, politician and moral crusader, an intellectual subversive who brought philosophy and tales of past centuries into day-to-day economics. Desai, who died in his native India on 29 July, aged 85, was emeritus professor at the London School of Economics and Political Science and chaired the advisory board (later council) of OMFIF from its inception in January 2010 to May 2025, when he handed over to Norman Lamont.
Narendra Modi, the Indian prime minister, issued this statement: ‘Anguished by the passing away of Shri Meghnad Desai Ji, a distinguished thinker, writer and economist. He always remained connected to India and Indian culture. He also played a role in deepening India-UK ties. Will fondly recall our discussions, where he shared his valuable insights. Condolences to his family and friends.’
Meghnad Desai and Bill Clinton at a public lecture ‘On Globalisation’, 2001
Desai played a key part in installing a bronze statue of his hero Mahatma Gandhi in London’s Parliament Square, unveiled in 2015 to mark the 100th anniversary of Gandhi’s return to India from South Africa to begin his struggle for independence. He became a member of the British House of Lords in 1991.
Lamont, a former chancellor of the exchequer, said: ‘I had a personal and special relationship with Meghnad Desai. As a Labour party frontbench spokesman in the Lords, he defended one of my most unpopular policies (increasing VAT) when I was chancellor. Unfortunately, it cost him his job and he was sacked by Tony Blair for his view.’
‘But Meghnad was too much of a free spirit for party politics. He loved an argument. Wherever logic and truth led, he followed. Wherever there was debate, Meghnad was the heart and soul of it. Although he was always scrupulously polite, he was no respecter of persons and had a great sense of humour. He had a creative mind, ready to think unconventionally. He enjoyed being astride the two very different worlds of academe and Parliament. He will be greatly missed both at OMFIF and the House of Lords, where he was popular and respected.’
Desai was a Labour party member for 49 years, with a leading role in the London constituency of Islington South. His long-time sparring partner Jeremy Corbyn, Labour leader in 2015-20, was the opposing force in Islington North.
Desai quit the party in 2020, claiming that Keir Starmer, Corbyn’s successor, now prime minister, had not done enough to curb anti-Semitism in the party. He warned that Labour’s ambivalence over anti-Semitism distracted attention from its task of winning back a reputation for sound economic management.
Building intellectual bridges – and knocking them down again
Desai was the economist for all seasons. He was equally at home on a central banking stage in Frankfurt, St Louis, Pretoria or Brasília, bemoaning shortcomings in monetary policies in the House of Lords, telling a Singapore audience that 500 years of western dominance over Asia were finally at an end or describing to Malaysian students the essential difference between governance structures in India (‘a mud pie’) and China (‘a brittle Ming vase’).
Desai’s speciality was in building intellectual bridges spanning alternative viewpoints and then, equally engagingly, knocking them down again in a quest for new crossing points to parallel destinations.
Ernst Welteke, former Deutsche Bundesbank president and founder member with Desai of the advisory board, said: ‘His experience and interests as a scientist, teacher, public thinker and politician made him a true globalist whose words we always heeded as he built bridges between continents and cultures. We will miss him greatly.’
Among other members of the advisory council, Marsha Vande Berg of Stanford University said: ‘He was a joy to be in conversation with. And his wonderful bushy hair seemed to match his vigorous engagement on whatever topic.’ Hani Kablawi of BNY said: ‘We are sad to lose a great mind.’ Philip Middleton, like Vande Berg and Kablawi, one of the council’s vice chairs, called him ‘irreplaceable’. Prakash Kannan of GIC in Singapore, termed him ‘an intellectual force and a great friend to OMFIF’.
Desai’s 80th birthday dinner
Sheila M’Mbijjewe, former deputy governor of Central Bank of Kenya, said: ‘In a world full of half-truths and ego, he was a pillar of strength and provider of relief.’ Irena Radović, governor of the Central Bank of Montenegro, a newcomer to the council, said: ‘Lord Desai’s departure leaves us saddened, but also grateful for the privilege – even if only briefly – of having known and worked alongside such an extraordinary individual.’
Edoardo Reviglio of Luiss University in Rome regarded Desai as ‘a great scholar, able to move effortlessly between the grand ideas of politics and the technicalities of economics and its formulae. His contributions will take their place in the history of western thought. His constant input and presence were an essential part of the success of this truly special organisation.’
Paweł Kowalewski of Narodowy Bank Polski, recalls a joint conference at Bank Negara Malaysia, where Zeti Akhtar Aziz, Malaysian central bank governor, was complaining about a leading British politician who had berated her and other policy-makers as ‘insects’ for not following his line of economic policy reasoning. Desai defused the tension and dissolved the audience into laughter by pointing out that this politician ‘treats everybody like that’.
Exhibition on Mahatma Gandhi in Delhi. Credit: British High Commission, New Delhi
Raj Bhatt, chairman and chief executive of Elara Capital, the Indian securities firm, where Desai was a director, said: ‘Lord Desai’s insights into global economics and his unwavering commitment to public service left an indelible mark on academia, policy and society at large. His intellectual legacy and courageous voice will continue to inspire generations to come.’
Curiosity and taste for the unconventional
Desai’s curiosity and taste for the unconventional (occasionally, the outrageous) were epitomised by his spontaneous agreement 15 years ago to chair the advisory body of the nascent OMFIF, an acronym he regarded as beguilingly absurd.
His interest was based on desire to prise open the portals of central banking and learn more about ideas and initiatives stemming from sovereign funds – a category of investment vehicle with which Desai and the LSE at the time were becoming enamoured.
Desai was a driving force fusing diverse minds and personalities into a new grouping probing the multiple actions of central banks after the 2007-08 financial crisis. With an eclectic background in econometrics and Marxian economics, Desai was founder-director in 1992 of the LSE’s grandly named Centre for the Study of Global Governance.
Desai with a student. Credit: LSE Library
Author of a stunningly wide range of books – from authoritative accounts of Indian cultural historical figures to masterful analyses of international political economy – Desai owned a vast literary collection (including many works on Gandhi) which was still, on his death, seeking a home.
His autobiography Rebellious Lord – ‘the story of an intellectual and political maverick’ – was published in 2020. In 2010, he launched an incursion into sexually charged political fiction Dead on Time featuring an adventurously deviant British prime minister, Harry White.
‘If Liz Truss becomes prime minister, sterling will crash’
A follower of the theories of Nikolai Kondratieff regarding ‘supercycles’ of long-term economic phenomena, Desai got most (but not all) of his predictions right. Immediately after the British referendum vote to leave the European Union in June 2016, he wrote: ‘We can ignore the miracles promised by the Brexiteers or the dire prediction of the Remainers.’
In August 2022, he forecast that ‘if Liz Truss becomes prime minister, sterling will crash’ – accurately foreshadowing what happened only weeks later.
In 2016, Desai authored an OMFIF monograph, ‘The political economy of Donald Trump’ outlining key features of the forthcoming political phenomenon. Although correctly predicting that the Republican candidate would win the 2016 election, he was wide of the mark (by four years) in forecasting Trump would get a second term in 2020.
Attending an annual meeting of the International Monetary Fund with Meghnad or walking with him through the corridors of the Reserve Bank of India, was akin to a global voyage down memory lane. Officials and economic experts of all varieties would come up to greet him and recall times past when he had marked their papers or supervised their work – much of which he affected to remember.
Desai used the language of theatre to convey the essentials of fast-moving economic policy drama. The venues were multifarious: whether telling the Federal Reserve home truths about the dollar, warning European officials that Greece would default on its debt, telling an Anglo-Chinese gathering that Britain had had a ‘nervous breakdown’ over Brexit, or describing European Central Bank president Mario Draghi’s 2012 ‘whatever it takes’ ploy to rescue the euro as ‘a brilliant confidence trick’.
Over his 15 years of engagement with OMFIF, Desai has been a constant advocate of increasing the monetary role of gold, including through using it to back the International Monetary Fund’s Special Drawing Rights basket of currencies. Elements of this approach have already been reflected in the de facto upgrading of gold’s monetary role in recent years.
He could be brusque. A rare occasion when OMFIF had to enforce its ‘no-selling’ rule on commerciality intruding into central banking meetings came in South Africa. Desai told an over-enthusiastic specialist attending a meeting at the South African Reserve Bank to ‘shut up’ because no one was interested in the financial products he was laboriously describing.
Desai was reliable, good-hearted, witty, generous and unfailing in his observations and in his insight. He could tear through hypocrisy and pomposity with the same incisive spirit with which he could dissect economic statistics and demolish the arguments of allies and adversaries alike.
He was always present as a friend, a confidant, a mentor, a larger-than-life source of strength, humanity and wisdom in an embattled world.
We shall miss him terribly. Our deepest condolences go to his widow Kishwar and his family.
David Marsh is Chairman of OMFIF.