The RBI MPC serves no purpose other than cosmetic and should be dismantled

There are two insurmountable hurdles in the path of RBI's independence on monetary policy. These hurdles make committees redundant

Inflation has become a problem. In this context it’s useful to recall that it’s now five years since the government — heeding advice that India should copy the developed countries of the West — enacted a law that created a monetary policy committee (MPC) to ensure that inflation stayed within a band of 2-4-6 per cent. It hasn’t been able to do that.

Some former governors of the Reserve Bank of India (RBI) had since then said inflation targeting wouldn’t work in India. They have been proved right.

Those who gave the advice to go for such targeting via an