RBI CONCEPTS:The Monetary Policy Committee #9(PART-3)

Oracle IAS, the best coaching institute for RBI grade B/NABARD/SEBI in Dehradun (Uttarakhand), brings to you views on important issues.

What is Monetary Policy Committee?

It is the committee which will decide India’s Monetary Policy.
The formation of the monetary policy committee was mooted by the Urjit Patel committee(2016). The current mandate of the committee is to maintain 4% annual inflation until March 31, 2021, with an upper tolerance of 6% and a lower tolerance of 2%.
The committee suggested that monetary policy be rule-based and not discretion-based. The final decision on monetary policy should not lie with the RBI governor alone but on a group of people.

Composition of MPC

MPC will be a 6 member committee:
- 3 members will be from RBI. These 3 members would include the governor who will also be the ex-officio chairperson of the committee.
- 3 members will be appointed by the central govt. These members should be experts in the field of finance or banking or economics or monetary policy. They will have a tenure of 4 years and will not be eligible for reappointment.
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Hemant Bhatt is a B. Tech from Pantnagar University and has studied Social Sciences at SciencesPo, Paris. He teaches at Oracle IAS, Dehradun. He has given 5 UPSC mains back to back along with 2 interviews.
He is a bibliophile,accomplished writer and a fitness enthusiast.

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