The Finance Ministry on Monday decided to set up a crisis management group (CMG) to deal with the impact of global problems on the domestic economy.
The decision to set up a CMG was taken at a meeting headed by R Gopalan, secretary, department of economic affairs in the finance ministry.
“The group will work towards developing an early warning mechanism to avert a crisis,” a senior Finance Ministry official said, adding that the council will also have experts.
The meeting was attended by Chief Economic Advisor Kaushik Basu, Financial Services Secretary D K Mittal and Disinvestment Secretary Mohammad Haleem Khan, among others.
The idea to set up a small group comprising representatives of regulators to deal with the crisis was mooted by the Reserve Bank of India. The apex bank had pitched for “a closely knit nimble footed CMG with representations from various regulatory bodies, namely, RBI, SEBI (Securities and Exchange Board of India), IRDA (Insurance Regulatory and Development Authority), PFRDA (Pension Fund Regulatory and Development Authority) and the Government of India, Ministry of Finance.”
The group, which will be a part of the Financial Stability and Development Council (FSDC), according to sources, will be headed by the Secretary of DEA.
The group, the official said, would be on the lines of the Financial Stability Oversight Council, which was set up by the US administration to identify threats and responding to emerging risks to ensure stability of the financial system.