Monetary Policy Committee

I have read it that Finance Minister Arun Jaitley and Reserve Bank of India Governor Raghuram Rajan have agreed to a model of the proposed monetary policy committee (MPC).

This committee will be constituted by seven members -

three representatives from RBI, including the governor,

three representatives from the government.

There will also be a government nominee who will not have any voting rights.

The nominee’s job would be to carry the voice of the government before any decision on interest rates is taken by panel.

The decision by the committee will be taken on a majority vote but in case of tie, the RBI governor will have a casting vote.

The RBI governor will not have any veto power in the MPC,

In current structure of monetary policy,RBI chief has the final say on interest rate decisions and RBI have a technical advisory committee but the RBI governor is free to against its recommendations.

The objectives of the panel will be make policy keeping in mind an inflation target based on the consumer price index (CPI) numbers as well as to manage growth.

This issue came under public attention recently after a draft constituted by the government had proposed a draft that did not offer a veto for the RBI governor. Critics attacked the move saying that a seven-member MPC dominated by the government would effectively take away monetary policy making powers from the RBI.

But as per new recommendation, six voting members and a casting vote in the hands of governor will likely tilt the balance back in favor of the RBI. The Finance Minister will have a Cabinet note approved on this and a bill to constitute an MPC is likely to be constituted in the Winter session of Parliament.

But the question is what is need of such changes, We all know that RBI is playing an effective role for controlling inflation.Presently, CPI is below 5% and WPI is near to zero. Whole world is praising our RBI governor for his decisions and role in Indian economy. So why govt. want to intervene in the functional structure of RBI ? I think RBI should be independent from government. Presently, RBI is bound under RBI act 1934 and Governor is answerable to govt. And this step of govt. is one more steps against independence of RBI.

ENGINEERING GRADUATES

In year 2006-07, there were ‪1511 engineering colleges in India but now this number is 3345. India is producing more than 1.5_million_engineers every year. I think, I should use "‪‎Engineering Graduates" instead of "‪‎Engineers". These number of engineering graduates is more than total number of engineers passing from US and china both. But as we all know that choosing a technical degree means we want jobs... not a small one but a job from which we can earn high enough than that of a middle class person. But this is not true at all because average salary of an engineering graduate is only ‪‎2_3_lpa‬ (combining IITs,NITs,State colleges,Private colleges). Engineering graduates are not able to find job in their respective engineering fields. Now,they start to move in every fields like ‪‎banking,customer care,administrative etc. 2 days ago, I read a news that more than 75000 applicants applied for 30 posts of peons in Chhatisgarh and most of them were engineers. Being a ‪3rd year engineering students, these statics depressed me more than anything else. I want to know the reason behind this. I want to know Why educationist says that‪ Unemployment
 is not a main problem of India but the problem is‪ ‎unemployability‬. These educationists comment that India is in the way of producing "‪#‎UNEMPLOYABLE YOUTH WITH HIGHER DEGREES". There are so many reasons behind this but most important one is that‪ students are not willing to learn and  aculties are not willing to teach. We want to solve problems rather than analyze problem. We want higher grades but not even try to learn. We all want a faculty who gives us higher grades rather than a good understanding of subjects. Being an average student, I can say that there are so many loop holes in this system and we are in way of converting these loop holes into "‪manholes‬".