India has voluntarily sought a comprehensive financial sector assessment programme (FSAP) by the International Monetary Fund and the World Bank as the country has been found to be compliant with internationally-accepted financial standards, Union Finance Minister Pranab Mukherjee said here on Monday.
Addressing the second international finance conference, organised by the Indian Institute of Management, Calcutta, Mr. Mukherjee said the country had done a self-assessment of the financial sector in 2009 and was found “compliant with most of the internationally-accepted standards I banking security, market and the insurance sector.''
“This has given us the confidence to get our financial sector to be evaluated by the IMF and the World Bank. So we have voluntarily sought a full-fledged FSAP, which is an international evaluation exercise conducted by the two global bodies,” he said.
Emphasising that the Centre is determined to carry out reforms in the financial sector with financial stability becoming an integral part of policy discussions, Mr. Mukherjee said the Centre would soon set up a financial sector legislative reforms commission. The commission would rewrite and clean up financial sector laws and bring them in line with the requirements of the sector.
He pointed out that though the global economic meltdown had ‘compelled' the world leaders to rethink some traditional principles of financial policy matters, he expressed satisfaction that India among a few other countries had shown a ‘robust growth' of Gross Domestic Product while the revival process in the U.S. and Europe were facing several problems.
Mr. Mukherjee, however, admitted that the surge in capital inflows and inflation, including the hardening of global commodity prices, was a matter of concern faced by the Centre. Mr. Mukherjee said the banking sector had been given a target to provide banking services to every habitat with a population of over 2,000 by March 2012.
