Union Government notifies constitution of Monetary Policy Committee
The Union Government has notified the constitution of the six members Monetary Policy Committee (MPC).
In this regard, the Union Finance Minister has used powers designated under the section 45ZB of the Reserve Bank of India (RBI) Act, 1934 to constitute MPC.
Composition of MPC
- Urjit Patel: RBI Governor (Chairperson).
- R Gandhi: Deputy Governor RBI in charge of Monetary Policy (Member).
- Michael Patra: Executive Director of RBI (Member).
- Chetan Ghate: Professor, Indian Statistical Institute (ISI) (Member).
- Professor Pami Dua: Director, Delhi School of Economics (DSE) (Member).
- Ravindra H. Dholakia: Professor Indian Institute of Management (IIM), Ahmedabad (Member).
About Monetary Policy Committee (MPC)
- The six member MPC has been 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 institutionalised framework for MPC.
- 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 Central Government.
- Governor of RBI (ex officio Chairperson), Deputy Governor of RBI, in charge of Monetary Policy (Member), One officer of RBI (Member) and three members appointed by Central Government as members.