* 5 of 6 external members suggested a cut in repo rate
* RBI held its repo rate steady at 8 pct on Oct. 30
(Adds details, background)
MUMBAI, Nov 21 (Reuters) - India's central bank Governor
Duvvuri Subbarao went against the suggestion of most external
members of an advisory panel to keep the key repo rate steady on
Oct. 30, minutes of the quarterly meeting released on Wednesday
Of the six external members of the Reserve Bank of India's
Technical Advisory Committee (TAC) on monetary policy who
attended the meeting, five suggested a repo rate cut in the
second quarter review of the monetary policy.
The committee consists of seven external members, apart from
the governor and the deputy governors. The panel's role is
purely advisory, with the governor having the final say in
The RBI left interest rates on hold, but cut the cash
reserve ratio for banks, defying pressure from the government to
lower rates for the first time since April. However, it
indicated it may ease the policy rate in early 2013.
Of the five members who suggested a repo rate cut, three
recommended a reduction by 25 basis points, while the other two
suggested a sharper 50 basis points cut.
One of the members who recommended a repo rate cut of 25
basis points also suggested a 25 basis points cut in banks' cash
reserve ratio, or the share of deposits they have to maintain
with the central bank.
One external member felt no change in the monetary policy
stance was necessary, and one could not attend the meeting.
"They felt that even though inflation is sticky, there are
no demand pressures and there is a need to revive investments,"
the minutes said, referring to the external members.
Since February 2011, the RBI has been placing the main
points of discussions of the TAC meetings in the public domain
with a lag of roughly four weeks after the meeting.
The governor has however acted against the advice of the
majority of the panel on most occasions, minutes showed.
(Reporting by Shamik Paul; Editing by Anupama Dwivedi)