Business News Desk, The month of October is very important because after the US Federal Reserve recently cut its interest rates, the Reserve Bank of India is also going to announce its bi-monthly monetary policy. Monetary policy impacts people’s EMIs and interest rates on everything from home loan to car loan. But even before this, RBI has made a major reshuffle in the Monetary Policy Committee that takes decisions on interest rates. In the 6-member Monetary Policy Committee of RBI, 3 members are from RBI itself, while 3 members are included from outside. RBI informed on Tuesday that 3 new external members have been included in the Monetary Policy Committee (MPC). The government has appointed Ram Singh, Saugata Bhattacharya and Nagesh Kumar as new external members of the Monetary Policy Committee of the Reserve Bank of India.
Introduction of new members of RBI MPC
The government has reconstituted the Monetary Policy Committee (MPC) of the Reserve Bank of India, which decides the repo rate. Using the powers given under the Reserve Bank of India Act-1934, the government has reconstituted the Monetary Policy Committee. He is the Director of Economics. Saugata Bhattacharya is an economist. Whereas Dr. Nagesh Kumar is the Director and CEO of the Institute for Industrial Development Studies. Before this, Dr. Ashima Goyal, Jayant R Verma and Shashak Bhide were included as external members in RBI MPC and their tenure is ending this week.
RBI MPC framework
According to the provisions of the RBI Act, the MPC consists of six members. Three members are appointed from RBI and three by the Central Government. According to the statement of the Finance Ministry, under Section 45ZB of the Reserve Bank of India Act-1934, the Central Government has reconstituted the Monetary Policy Committee of the Central Bank. Apart from these 6 members in the MPC, the Governor of RBI is the chairperson of the MPC. Apart from this, the Deputy Governor in charge of monetary policy in the Reserve Bank is its member. Whereas the RBI officers nominated by the Central Board are ex-officio members.
