In India, which one of the following is responsible for maintaining price stability by controlling inflation?

Answer: D. The RESERVE BANK OF INDIA is responsible for maintaining price stability by controlling inflation. The PRIMARY OBJECTIVE of RBI's monetary policy, as enshrined in the RBI Act 1934 (Section 45ZA, amended in 2016), is to MAINTAIN PRICE STABILITY while keeping in mind the objective of growth. The RBI Act sets a flexible inflation target of 4% (with a tolerance band of plus or minus 2%, i.e., 2-6%) measured by CPI inflation, jointly agreed with the Central Government every five years. The MONETARY POLICY COMMITTEE (MPC), constituted under the RBI Act, sets the policy repo rate to achieve this inflation target. MPC has 6 members (3 from RBI including the Governor, 3 external members nominated by the Government). Distractors: (A) Department of Consumer Affairs handles consumer protection laws. (B) Expenditure Management Commission (Bimal Jalan, 2014) made recommendations on expenditure but has no inflation-fighting role. (C) Financial Stability and Development Council (FSDC) coordinates regulators on financial stability, not inflation. Source: RBI Act 1934 (as amended 2016) / Monetary Policy Framework Agreement 2015.