Wanted: An MPC with more power and 'flexibility'

The members can come from diverse backgrounds such as finance, labour and economics, and must have a say in the entire interest-rate architecture

The Monetary Policy Committee (MPC), Indian central bank’s rate-setting body under a new monetary policy framework put in place in 2016, had its 24th meeting last week, completing its four-year term. Six members of the MPC unanimously decided to keep the policy rate on hold. Many of the MPC’s calls have been unanimous, but not all. In the past 24 meetings, there have been split decisions on 14 occasions.

During its four-year tenure, the MPC opted for a status quo 13 times, a rate cut at nine meetings and a hike twice. While the quantum of rate hike was 25 basis