Which section of RBI Act 1934 provides the powers to constitute Monetary Policy Committee ........

Economic and social issues (RBI) Monetary and fiscal policies

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Which section of RBI Act, 1934 provides the powers to constitute Monetary Policy Committee?

Section 45 ZB

Section 7(1)

Section 21

Section 35

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Explanation:

Reserve Bank of India Act, 1934 is the legislative act under the Reserve Bank of India was formed. This act along with the Companies Act, which was amended in 1936, were meant to provide a framework for the supervision of banking firms in India.
The Act contains the definition of the so-called scheduled banks, as they are mentioned in the 2nd Schedule of the Act. These are banks which were to have paid up capital and reserves above 5 lakh.

There are various section in the RBI Act but the most controversial and confusing section is Section 7. Although this section has been used only once by the central govt, it puts a restriction on the autonomy of the RBI. Section 7 states that central government can legislate the functioning of the RBI through the RBI board, and the RBI is not an autonomous body.