RBI reconstitutes Monetary Policy Committee; Saugata Bhattacharya, Ram Singh, Nagesh Kumar on panel

The Reserve Bank of India has reconstituted  the Monetary Policy Committee (MPC) as per section 45ZB of the Reserve Bank of India Act, 1934. As per the provisions of the RBI Act, the Monetary Policy Committee (MPC) consists of six members: three Members from RBI and three are appointed by the Central Government. The MPC will have the following members 

(a)  Shaktikanta Das, Governor of the Reserve Bank of India — Chairperson, ex officio;

(b)  Deputy Governor of the Reserve Bank of India, in charge of Monetary Policy —Member, ex officio;

(c)  One officer of the Reserve Bank of India to be nominated by the Central Board —Member, ex officio;

(d)  Prof. Ram Singh, Director, Delhi School of Economics, University of Delhi —Member;

(e) Shri Saugata Bhattacharya, Economist — Member; and

(f)  Dr. Nagesh Kumar, Director and Chief Executive, Institute for Studies in Industrial Development, New Delhi — Member.

The Members of the Monetary Policy Committee appointed by the Central Government shall hold office for a period of four years, with immediate effect or until further orders, whichever is earlier.

The RBI appoints three representatives, including the governor, while the remaining three members are external appointees. A selection panel comprising of RBI Governor Shaktikanta Das, Cabinet Secretary T.V. Somanathan, and Economic Affairs Secretary Ajay Seth, is responsible for choosing the external members of the MPC. The final approval for these positions lies with the Prime Minister's office under Narendra Modi.

RBI MPC meeting in October

The RBI's next monetary policy committee (MPC) meeting will start on October 7 and the key decision on interest rate revision will be shared on October 9. Currently, RBI’s repo rate is at 6.5 per cent.

According to analysts, the Reserve Bank of India (RBI) is unlikely to lower interest rates, unlike the US Federal Reserve. The focus is on aligning inflation with the medium-term target rate of 4 percent.

The RBI follows a CPI-based inflation targeting framework and is currently aiming to keep inflation at 4 percent, allowing for a tolerance range of ±2 percentage points.

In the past nine Monetary Policy Committee (MPC) meetings, the RBI has kept the repo rate unchanged. The current main goal is to reduce inflation to meet or even surpass the target level.