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Govt nominees on RBI MPC to get Rs 1.5 lakh a meet, reveal assets every yr

All MPC members will need to observe a silent period of 7 days before and after the rate decision

Press Trust of India  |  New Delhi 

Reserve Bank of India
File photo of the RBI's logo

The government appointees on the powerful Monetary Policy Committee will be paid Rs 1.5 lakh per meeting along with air travel and other reimbursements, but will need to observe a "silent period" seven days before and after the rate decision for "utmost confidentiality".

The silent period and confidentiality requirements will also apply to the three members, including the Governor, on the panel that has been deciding on policy rates since October last year, the central bank has said.


The members of the Governor-chaired panel, which has to hold meetings at least four times in a year, are also required to be mindful of any conflict between their personal and public interest while interacting with profit making organisations and making personal financial transactions, the Reserve Bank said in its newly notified regulations for functioning of the committee.

The six-member MPC, constituted in September 2016, has three persons appointed by the central government while the rest, including the Governor, are from the

The members appointed by the government would "receive a remuneration of Rs 1,50,000 for devoting time and work for each meeting of the committee... Which they attend and other expenses relating to air travel, local transportation and accommodation as may be decided by the central board from time to time," as per the regulations.

The panel is required to meet at least four times in a year and the has been convening a bi-monthly meeting of this committee.

Chetan Ghate, professor at the Indian Statistical Institute, Pami Dua, director at the Delhi School of Economics and Ravindra H Dholakia, professor at the Indian Institute of Management, Ahmedabad are the three government-appointed members.

Their appointment is for a period of four years or until further orders, whichever is earlier.

Apart from Governor Urjit Patel, Deputy Governor and Executive Director M D Patra are also part of the committee.

The regulations do not mention whether any separate allowance would be given to the members on the committee.

Earlier this year, Patel and his deputies got a big pay hike with the government more than doubling their basic salary to Rs 2.5 lakh and Rs 2.25 lakh per month, respectively.

The "basic pay of the Governor and Deputy Governors" have been revised retrospectively with effect from January 1, 2016 and marks a huge jump from Rs 90,000 basic pay so far drawn by the Governor and Rs 80,000 for his deputies.

According to the Monetary Policy Committee and Monetary Policy Process Regulations, 2016, members should also take adequate precaution to ensure utmost confidentiality of its policy decision before that is made public and preserve confidentiality about the decision making process,

These regulations were notified by the earlier this month.

"While interacting with profit-making organisations or making personal financial decisions, they shall be mindful of, and weigh carefully, any scope for conflict between personal interest and public interest," the regulations said.

Each member of the has one vote and in case the numbers are equal, the governor has the casting vote.

The MPC, which has the responsibility of achieving a set inflation target, should submit a report to the government in case of failure to achieve the required target.

In such instances, the report shall be sent to the central government "within one month from the date on which the bank has failed to meet the inflation target".

The regulations further said the schedule of the meetings for the entire fiscal year needs to be announced in advance. At least 15 days of notice is required for convening a meeting ordinarily, but an emergency meeting can be called with 24 hours notice for each member and technology-enabled arrangements need to be made for even shorter notice period meetings.

All members need to disclose their assets and liabilities and update this information once every year.

"Members shall observe a silent or blackout period starting seven days before the voting/decision ray and ending seven days after the day policy is announced. During this period, they will avoid public comment on issues related to monetary policy other than through the MPC's communication framework," the said.

Also, members cannot reveal outside the committee any confidential information accessed during the monetary policy deliberations.

After conclusion of meeting, a resolution needs to be made public including on the policy repo rate and any other monetary policy measures at the discretion of the Chairperson while keeping in view the functioning and timing of financial markets.

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