 "Govt rolls back proposals to set up new public debt management agency")
The government on Thursday withdrew proposals to set up an independent public debt management agency (PDMA) and strip the central bank of authority to regulate government bonds.
Finance Minister Arun Jaitley, ahead of a vote in the Lok Sabha, said the government would instead consult the Reserve Bank of India (RBI) and come out with a detailed roadmap for a new debt management agency.
Jaitley had proposed to set up a debt agency when he unveiled the annual budget in February, but they had become a source of friction between the RBI and the finance ministry.
"Since the RBI has been handling public debt management, the government in consultation with the RBI will prepare a detailed roadmap separating the debt management function and the market infrastructure from the RBI and having a unified financial market," Jaitley said.
He made these remarks while initiating the debate on the Finance Bill in the Lok Sabha. The House is expected to approve the Bill later in the day, giving effect to the tax proposals.
"It is...Being decided to delete the PDMA provisions from the Finance Bill for this financial year," Jaitley said.
"This government is committed to unifying the financial market both by making the government securities part of this market as well as creating a proper bond currency derivate market," he added.