"A final note on setting up the National Counter Terrorism Centre (NCTC) is now before the Cabinet Committee on Security and we hope a decision will be taken before the end of this calendar year," he said during Question Hour in the Lok Sabha.
However, he said, no final decision has been taken on the constitution and structure of the proposed NCTC.
Chidambaram replied to supplementaries amid vociferous protests by the opposition NDA, which demanded his ouster in connection with the 2G case.
NDA members were on their feet every time he rose to answer questions but Speaker Meira Kumar ignored the opposition protests and went ahead with the Question Hour.
The BJP had also given a notice to move a privilege motion against the Home Minister for allegedly showing disrespect to Parliament by making a statement outside the House over a recent controversy on a court case in which Chidambaram had appeared on behalf of a Delhi hotelier.
Chidambaram said the NATGRID has been set up to link databases which would be an input in combating terrorism.
"It intends to create a facility that improves India's capability to counter internal threats," he said.
The Intelligence Bureau is responsible for collecting, collating and disseminating intelligence having bearing on national security and protection of the Constitution.