He will be most remembered for bringing an end to automatic deficit financing and thereby for setting the course for independent monetary policy.   Dr. Bimal Jalan ably steered India to ensure that we were not affected by the Asian Crisis.
If steady-state real rates are lower, then the so-called “neutral setting of monetary policy” would also be lower. That is, the neutral funds rate would be lower. The debate about a secular decline in growth today thus translates into a discussion of where, or how high, the neutral policy rate should be.