Agarkar believed the selection committee should look at Virat Kohli's performance as India's Test captain and take a call on Dhoni's future in the limited-overs cricket after the ongoing South Africa series.
"The selectors need to have a closer look at what MS Dhoni is doing, not just as captain, but as a player as well," Agarkar was quoted as saying by 'ESPNcricinfo' ahead of the five-match ODI series against South Africa.
Agarkar pointed out Dhoni's slump in form with the willow.
"He has been a great player for India, but you don't want him to become a liability for the team. And he needs to perform a lot better than he has (been). Just because he has done it over the years, doesn't mean it's okay for him to fail."
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The former pacer was also not in favour of Dhoni's decision to bat at No 4 in the one-day format at the expense of somebody like Ajinkya Rahane.
"You can understand if there are batsmen who can't bat 3 and 4. But there is Ajinkya Rahane, who has been one of your best players in Test cricket and I don't think he can bat lower than four in ODIs yet, unless he changes his game over his career.