- MPC is headed by RBI governor, is a six-member panel, of which three members are from RBI and three are independent members selected by government. The independent members are experts in the field of economics, banking or finance.
- The governor, however, will not enjoy a veto power to overrule the other panel members, but will have a casting vote in case of a tie. No government official will be nominated to the MPC.
- MPC is expected to bring “value and transparency” to rate-setting decisions.
- The MPC will meet four times a year to decide on monetary policy by a majority vote.
- The committee was formed on the recommendation of Urjit Patel Committee, 2014.
- MPC was constituted on many-heads-are-better-than-one approach and is expected to ensure that the decisions are not influenced by bias or lobbying.