Mumbai: The Reserve Bank of India (RBI) on Thursday set up a committee to examine its monetary policy framework and recommend what needs to be done to revise and strengthen it with a view to making it transparent and predictable.
Raghuram Rajan, in his maiden speech as RBI governor on 4 September, first said such a committee would be set up under deputy governor Urjit Patel.
On Thursday, RBI named the other members of the committee. The members will be P.J. Nayak, Chetan Ghate, Peter J. Montiel, Sajjid Z. Chinoy, Rupa Nitsure, Gangadhar Darbha and RBI’s executive director Deepak Mohanty.
The terms of the committee will be to review the objectives and conduct of monetary policy in a globalized and highly inter-connected environment, recommend an appropriate nominal anchor for the conduct of monetary policy, review the central bank’s organizational structure, operating framework and instruments of monetary policy, particularly the multiple indicator approach and the liquidity management framework, with a view to ensuring compatibility with macroeconomic and financial stability, as well as market development.
The committee will also identify regulatory, fiscal and other impediments to monetary policy transmission, and recommend measures and institutional pre-conditions to improve transmission across financial market segments and to the broader economy, RBI said in a statement on its website.
The committee is expected to submit its report within three months.