a man like that, dressed in no more than a loin cloth, and in a world where mass communication media had not developed, could galvanize 300 million people across all strata of society, and inspire the trust and confidence of an entire nation with no other weapon than sheer strength of character. what is more, even today, around the world, the mahatma is a role model for value based leadership, no matter that specific causes and contexts may be different. 6. the enigma of mahatma gandhi as a leader illustrates the challenge of precisely defining what makes a leader. that is what makes speaking about leadership so difficult. speaking about leadership in a time of flux, at a time when such momentous changes are taking place, especially in the global economy, is an even more daunting task. it is that formidable task the conference organizers have thrust upon me. suresh neotia leadership centre 7. before getting on with that task, i must acknowledge my association with shri suresh neotia whose name this leadership centre very appropriately bears. shri suresh neotia, as many of you perhaps know, was till recently a member of the reserve bank of bis central bankers ’ speeches india ’ s central board of directors. in our board meetings, and in my interaction with him outside of the board, i have always been impressed by his mature, balanced and insightful views, and by the way he always held larger public interest as the only guide and determinant of public policy. the prestigious awards that he has won over the years, be it the padma vibhushan or the harvard business school - economic times award for corporate excellence, are a tribute to his leadership and his contribution to the country. he runs several grass root social development projects, and he does so not to fulfil any prescribed norm of corporate social responsibility, but out of an innate empathy with the less privileged. leadership in bengal 8. as i contemplate leadership in this wonderful city of kolkata and in this intellectually vigorous land of renaissance, bengal, my thoughts go to the leaders from this state who have been influential and “ made a difference ”, not only at the national level, but at the global level too. let us recall some of them to see the diversity of leadership models : often called the “ father of modern india ”, raja ram mohun roy was a pioneering social reformer and a progressive thinker, certainly ahead of his time, who had the courage of conviction to challenge some e

potentially adverse side effects. in other words, it assesses how long the “ medium term ” should be, given current circumstances. in earlier remarks, i argued that in the vicinity of the effective lower bound, attempting to shorten the horizon by further easing financial conditions carries the risk of shifting the balance of the costs and benefits of a highly accommodative monetary policy stance by increasing potential side effects. 6 at the current juncture, an important element in determining the appropriate length of the medium term is the risk of second - round effects that may entrench expectations of low inflation and thereby leave permanent scars on the euro area economy. however, this risk is mitigated by the emerging policy response in the euro area. for the first time, fiscal and monetary policy in the euro area are starting to act as true complements, thereby reinforcing each other ’ s effectiveness and paving the way for a sustainable recovery. moreover, inflation expectations by households currently signal very limited risks of second - round effects. while financial markets currently price in significant risks of deflation over the next five years ( see left chart on slide 9 ), households have adjusted their expectations in response to the pandemic very differently : the share of people that expect inflation to increase more rapidly over the course of next year has increased markedly in april, from 20 % to 36 %, and in may still accounted for 32 % ( see right chart on slide 9 ). so, given the already highly accommodative monetary policy stance, the growing complementarity between fiscal and monetary policy and the high uncertainty regarding secondround effects, our decision appears to be an appropriate and proportional course of action. the dual objective of pepp 5 / 7 bis central bankers'speeches to enhance the effectiveness of our asset purchases, the pepp has to be operationalised in a way that it meets the described dual objective. the pepp is not an interventionist programme where we stand on the sidelines when conditions are calm and enter the market only in times of market disturbances. it rather resembles a two - staged pyramid. at the basis, there is a constant flow of purchases that reaches out to all eligible market segments. in the sovereign space, these purchases are guided by the ecb ’ s capital key. this is the “ stance ” element of pepp. it seeks to create financial conditions that are consistent with our inflation aim. the upper part of the pyramid is its flexibility. this element responds to the challenges