Economics • Banking & FinanceMedium
Which committee recommended the establishment of the 'Monetary Policy Committee (MPC)' in India to set the benchmark policy interest rates?
A. Narasimham Committee
B. Urjit Patel Committee
C. Urjit Patel Committee on Monetary Policy Framework✓ Correct Answer
D. Nachiket Mor Committee
💡 Solution & Explanation
The Urjit Patel Committee on Monetary Policy Framework recommended setting up an institutionalized Monetary Policy Committee to determine benchmark interest rates. Committees like the Narasimham Committee focused on broader banking sector reforms rather than the specific statutory rate-setting panel. The recommendations led to amendments in the Reserve Bank of India Act of 1934 to establish the modern inflation-targeting framework.
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