Finance Minister Arun Jaitley held a meeting with RBI Governor Raghuram Rajan, Chief Economic Adviser (CEA) Dr. Arvind Subramanian, Chairman of The Securities and Exchange Board of India (SEBI) U K Sinha and other senior officers of the Government of India and financial sector regulators.
FM@arunjaitley chairing the Meeting of FSDC in Delhi today.All financial regulators are attending the Meeting. pic.twitter.com/bfbZL6FqWn— Ministry of Finance (@FinMinIndia) July 5, 2016
The experts presented their views and opinions about the major challenges that India faces and how to solve them to attain higher rate of growth.
Finance Minister Arun Jaitley:
Mr. Arun Jaitley spoke about the major challenges before the government which includes
1. Strategy to improve the overall performance of Public Sector Banks,
2. To make stalled projects functional and economically viable, and
3. To increase private sector investment among others.
Mr. Jaitley further said that due to better spread of monsoon, the government is expecting higher production of pulses this year compared to previous years which in turn will substantially ease their prices in the market.
CEA Dr. Arvind Subramanian:
CEA at the meeting gave an overview of the state of macro-economy and highlighted important issues. He noted that uncertainty in global economy and high volatility in the financial markets are prominent risks confronting the emerging market economies like India.
He however added that India appears to be much better placed today on the back of improvement in its macro-economic fundamentals, recent financial sector reforms by government and large forex reserves, which provides cushion against financial market volatility. With the revival of sentiment and certain signs of pick-up in industrial activity, a good monsoon is expected to further strengthen growth in India.
At the meeting a brief report on the activities undertaken by the FSDC Sub-Committee Chaired by Raghuram Rajan was placed before the FSDC.
The experts deliberated on the issue of rising bank NPAs and it was noted that measures taken by the Government and RBI for handling the stressed assets and also discussed the way forward to handle the situation.
The Council also discussed issues relating to developing a comprehensive framework for identification of Systematically Important Financial Institutions across all sub-sectors of financial sector.
On the issue of maturity of concessional swaps of 2013 against Foreign Currency Non-Residential deposits during September-December 2016, the experts noted the steps taken by RBI to suitably address the issue and its consequences.
Conclusion of the meeting:
At the end of the meeting members agreed on the need to continue to be in a state of preparedness for managing any external sector vulnerabilities, including those emerging from Brexit and its consequences.