The decision was taken in a meeting of the Union Cabinet chaired by Prime Minister Narendra Modi.
Announcing it, Finance Minster Arun Jaitley said, "A decision was taken today to set up a committee chaired by Vice Chairman of NITI Ayog, which will classify this caste data. When the task is completed, it will be made public at an appropriate time."
The government has been criticised by parties, including Samajwadi Party, JD(U), RJD and DMK for refraining from releasing the caste-based data in its first Socio Economic and Caste Census (SECC).
The SECC data released on July 3 is first in eight decades after 1912.
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Brushing aside suggestions that the government avoided giving the caste count in the survey report due to political reasons ahead of Bihar polls, Jaitley said that it will be good if the states, who are "politicising" it, send their recommendations of caste consolidation at the earliest.
He said that the government is keen to release the caste data at the earliest as soon as the states send the details because the committee headed by Panagariya will only then be able to classify it.
"It will be good that states, which are politicising it, send their caste consolidation recommendation at the earliest. They cannot hold back the recommendation and then say you please release it," he said, adding so far most of the states have not been able to send the caste consolidation details.
While the government has rejected the charge that not releasing the caste count has anything to do with Bihar polls, Lalu Prasad's RJD and Nitish Kumar's JD(U), which have come together to fight the state's Assembly election, have made a strong pitch to make it public in an apparent attempt to consolidate OBC votes.