Who among the following formulates the monetary policy in India?

The Correct answer is The Reserve Bank of India.

Key Points

• The Reserve Bank of India (RBI) is the central bank of India.
• The RBI is responsible for formulating and implementing the monetary policy in India.
• The primary objective of the RBI's monetary policy is to maintain price stability while keeping in mind the objective of growth.
• The RBI uses various tools to regulate the money supply and interest rates in the economy, including the Repo Rate, Reverse Repo Rate, Cash Reserve Ratio (CRR), and Statutory Liquidity Ratio (SLR).
• The RBI was established in 1935 under the Reserve Bank of India Act, 1934.
• It plays a crucial role in controlling inflation and ensuring the stability of the financial system.

 Additional Information

• The Finance Commission of India
  • The Finance Commission of India is a constitutional body that is responsible for recommending the distribution of tax revenues between the central and state governments.
  • It is established under Article 280 of the Indian Constitution.
  • The Finance Commission is appointed every five years.
• The NITI Aayog
  • The NITI Aayog (National Institution for Transforming India) is a policy think tank of the Government of India.
  • It was established in 2015 to replace the Planning Commission.
  • The NITI Aayog aims to foster involvement and participation in the economic policy-making process by the state governments.
• The Ministry of Statistics and Programme Implementation
  • The Ministry of Statistics and Programme Implementation (MoSPI) is responsible for the formulation of policies, their implementation, and coordination in the statistical field in India.
  • It also monitors the performance of government programs.
  • The ministry oversees the activities of the National Statistical Office (NSO).