"We are already working on it (on the rules). I think it should not take more than few weeks. Its a matter of weeks I would say," Economic Affairs Secretary Shaktikanta Das told in an interview.
He was replying about the progress for setting up of the six-member monetary policy committee (MPC), which will determine the benchmark interest rates.
Presently the rates are decided by the Governor of the Reserve Bank of India. Das also said that the amendments to the RBI Act have already been notified, and now "once the rules are notified, then the government will take up the selection of the three names from the government side".
The remaining three members would be from RBI with the Governor being the ex officio Chairperson. Deputy Governor of RBI in charge of the monetary policy will be a member, so will be an Executive Director of the Central bank.
Each member will have one vote and in case of a tie, the Governor shall have a casting vote. RBI Governor at present has overriding powers to accept or reject the recommendation of its panel on monetary policy. Members of the MPC will be appointed for a period of four years and will not be eligible for reappointment.
The inflation target will be decided in consultation with RBI and notified in the Official Gazette. The interest rates would be set up with a view to achieving the inflation target, to be determined by the government.
The committee will meet at least four times in a year and the government may, if it considers necessary, convey its views in writing to the committee from time to time.