Finance Minister Pranab Mukherjee today said it was time to revisit some of the age-old financial sector norms to usher in the next wave reforms in the sector.
“Some of the financial sector norms are nearly 50-years old. It is high time we made changes for effective financial sector norms, to be in tune with the dynamic need of the market. It is time to clear cobwebs to provide a firm foundation to usher in the next wave of reforms in the financial sector,” said Mukherjee addressing a convention organised by the Association of National Exchanges Members of India (Anmi) here today.
In the present complex market conditions, more transparency was required to reduce systemic risks.
While presenting the 2010-11 Union Budget, the government had announced the setting up of an apex-level Financial Stability and Development Council (FSDC) to strengthen and institutionalise the mechanism for maintaining financial stability.
Mukherjee clarified there would be dilution of power of the existing regulators, which “were doing a good job in the current scenario”.
He further said the government had decided to set up an apex level council for macro-level prudential supervision of the economy, including functioning of large financial conglomerates and address regulatory coordination issues.
“We need more transparency in the capital market to reduce systematic risk while we need to encourage more financial products on exchanges for trading which will help the real sector reduce risk,” the finance minister said.
Meanwhile, speaking at another event in the city, Mukherjee enumerated the incumbent United Progressive Alliance (UPA) government’s priority was to ensure that the economy broke through the double-digit gross domestic product (GDP) growth mark while safeguarding the interests of the common man. “We are not happy with just statistical growth. Rather, we want inclusive growth,” he said.
The economy would achieve a GDP growth rate of 8.5 per cent in 2010-11, Mukherjee said.
Adding that the access to jobs, food, education and healthcare facilities was a necessity nationwide, Mukherjee said, “But, these entitlements must be backed by legal provisions. We have already provided the right to information and elementary education. We are now working on the right to food through appropriate legislation.”
