RBI constitutes panel to strengthen monetary policy framework

The Reserve Bank today constituted a nine-member panel, to be headed by Deputy Governor Urijit Patel and consisting of external experts, to revise and strengthen the monetary policy framework.

The committee had been announced by Raghuram Rajan in his first address after taking over as the RBI Governor. It has been constituted to make the monetary policy "transparent and predictable", an RBI statement today said.

The terms of reference include review of the objectives and conduct of monetary policy in a globalised environment and to recommend an anchor for the conduct of policy, RBI said.

Amidst the debate over transmission, the committee will also "identify regulatory, fiscal and other impediments to monetary policy transmission", it said, adding that it will also recommend measures and institutional pre-conditions to improve transmission.

It will also "review the organisational structure, operating framework and instruments of monetary policy, particularly the multiple indicator approach and the liquidity management framework", the RBI statement said.

The committee is expected to submit its report in three months.

It will comprise former country head of Morgan Stanley P J Nayak, Chetan Ghate of Indian Statistical Institute, Peter Montiel from Williams College in USA, Sajjid Chinoy from J P Morgan, Rupa Nitsure of Bank of Baroda, Gangadhar Darba of Nomura Securities and RBI executive director Deepak Mohanty.

Michael Patra from the RBI's monetary policy department will be the member-secretary.