The Union Government notified the constitution of the six member Monetary Policy Committee (MPC) under section 45ZB of the Reserve Bank of India (RBI) Act, 1934.
Composition of MPC
- As per the provisions of the RBI Act, out of the six Members of MPC, three Members will be from the RBI and other three will be appointed by the Union Government.
- Members from RBI include
- Governor of RBI (ex officio Chairperson): Urjit Patel
- Deputy Governor of RBI, in charge of Monetary Policy (Member): R Gandhi
- One officer of RBI (Member) – Executive Director of RBI – Michael Patra
- The appointments committee of the cabinet last Thursday approved the names of following persons as MPC members for a period of four years.:
- Chetan Ghate, a professor at Indian Statistical Institute;
- Pami Dua, director at Delhi School of Economics (DSE); and
- Ravindra Dholakia, professor at the Indian Institute of Management, Ahmedabad,
About Monetary Policy Committee (MPC)
- MPC would be entrusted with the task of fixing the benchmark policy rate (repo rate) required to contain inflation within the specified target level.
- It will help in determining the Monetary Policy which in turn adds value and transparency to monetary policy decisions.
- The meetings of the MPC will be held at least 4 times a year and it will publish its decisions after each such meeting.
- The RBI Act was amended by the Finance Act, 2016 to provide for a statutory and institutionalized framework for MPC.