Government to soon decide Monetary Policy Committee structure: Shaktikanta Das

NEW DELHI: The government will soon decide the structure of the Monetary Policy Committee (MPC), which will fix the benchmark interest rate of the RBI and set inflation targets, said Economic Affairs Secretary Shaktikanta Das.

Besides, he said that the government will also firm up its plan for setting up a non-statutory public debt management agency (PDMA) in the next fortnight.
The government has proposed to set up the MPC, which will consist of representatives from the Finance Ministry and RBI, to decide on interest rate.
"On the Monetary Policy Committee, the government will take a decision very soon. The procedure for obtaining Cabinet approval, that process is in very advanced stage and it will be taken forward," Das told reporters here.

With regard to PDMA, "there is a proposal which is under inter-ministerial circulation and we expect to get the comments in next fortnight or so, after that the government will take a final view to take it forward," he added.

Presently, the idea is to start with a non-statutory PDMA but the remarks of various ministries and the Reserve Bank are awaited, he said, adding that it will be taken forward after comments are received.

A non-statutory PDMA would be an interim arrangement before an independent agency is set up for managing the government borrowing programme. At present, RBI is handling the government's borrowing programme.

The setting up of PDMA would require amendments to the RBI Act. The agency would be set up after the Cabinet approval, while a full-fledged PDMA would become operational only after amendment to the RBI Act.