Super-regulator set-up difficult: Jalan

Former Reserve Bank of India (RBI) Governor Dr Bimal Jalan said decision making in the economy cannot be independent till the time there is conflict in framing of economic policy, monetary policy and fiscal policy.

Dr Jalan was speaking at a function organised here by the Bombay Management Association to confer upon him the citation award for outstanding contribution to the Banking and Monetary Policies of India.

He also pointed out the fact that creation of a super-regulator for the financial markets is also difficult keeping in view the fact that there is too much diversification in the financial sector.

However, he lauded the strength of India's economic situation and said although India had seen economic growth in earlier periods, this time it is distinct.

This is because Indian policy decisions need no more be dependent on external eventualities and there is both optimism in the attitude of exporters and there is an emergence of strong entrepreneurial class.

He added that the concerns about external sector had dominated policy making for many decades due to foreign exchange crisis but such situation is unlikely to recur in the next 10 years.

"The sense of defeatism about the export is replaced now by sense of achievement, enabling us to take action. This was in addition to the emergence of new entrepreneurial class which was not rooted in the past," the former RBI governor said.

This favourable situation should be used to remove deficiencies in our public delivery systems, including those in health and education sector, he said.