Lack of quorum, RBI puts off MPC meet; new dates soon

Mumbai, September 28

The RBI on Monday postponed the meeting of the Monetary Policy Committee (MPC), the all-important interest rate-setting panel, over a possible lack of quorum as the appointment of independent members is delayed.

The RBI in a press statement said the MPC meeting, which was to begin for three days beginning Tuesday for a bi-monthly monetary policy review, has been rescheduled and new dates will be announced shortly.

“The meeting of the Monetary Policy Committee (MPC) during September 29, 30 and October 1, 2020 is being rescheduled. The dates of the MPC’s meeting will be announced shortly,” the RBI said.

The government moved the interest rate-setting role from the RBI Governor to a six-member MPC in 2016. Half of the panel, headed by the RBI Governor, is made up of external independent members.

The four-year terms of three external members of MPC ended last month and they are yet to be replaced by the government.

Rules require at least four members to be present at the meeting, with at least one being the Governor or his deputy, who is a member of the committee.

It was expected that the MPC would hold interest rates at the upcoming meeting as inflation was still above the comfort zone.

The government in 2016 appointed Chetan Ghate, a professor at Indian Statistical Institute; Pami Dua, director at Delhi School of Economics; and Ravindra Dholakia, professor at IIM, Ahmedabad, as independent members of the MPC for four years. The external members can hold office for a period of four years and are not eligible for re-appointment. The other ex-officio members of the MPC are RBI Governor, Deputy Governor (in-charge of monetary policy) and one RBI officer to be appointed by the central board. — PTI

Term of three members ended last month

• The meeting of the Monetary Policy Committee (MPC) — the interest rate-setting panel — was scheduled to be held from September 29 to October 1
• The four-year terms of three external members of MPC ended last month and they are yet to be replaced by the government
• Rules require at least four members to be present at the meeting, with at least one being the Governor or his deputy, who is a member of the committee

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