FSDC calls for constant vigil on functioning of financial institutions to achieve growth
Mumbai, February 22: Union Finance Minister Nirmala Sitharaman chaired a meeting of the Financial Stability and Development Council (FSDC) on Tuesday. The Council emphasised the need of maintaining a constant vigil over the country's financial conditions and the functioning of financial institutions.
"The Council deliberated on the various mandates of the FSDC and major macro-financial challenges arising in view of global and domestic developments," said the Finance Ministry.
The Council stated that the government and other regulators must keep a close eye on the financial conditions and operations of major financial institutions, especially considering that it could uncover financial vulnerabilities in the medium and long term.
The Council also addressed the steps that must be taken to develop the financial sector and ensure inclusive economic growth while maintaining macroeconomic stability.
Nirmala Sitharaman is in Mumbai for a two-day post-Budget outreach visit, where she will meet with industry representatives, financial market functionaries and bankers, according to the Finance Ministry.
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The Council, which was chaired by the Finance Minister, also discussed currency management operational difficulties. It also noted the operations of the FSDC Sub-Committee, which is chaired by the RBI Governor, as well as the actions taken by members in response to previous FSDC decisions.
The government, in consultation with financial market regulators, established the Financial Stability and Development Council to improve and institutionalise the system for maintaining financial stability, enhancing inter-regulatory coordination, and promoting financial sector development.
The Council monitors macro-prudential supervision of the economy, particularly the functioning of big financial conglomerates, and addresses inter-regulatory coordination and financial sector development issues while respecting regulators' autonomy. It also emphasises financial literacy and financial inclusion.
Bhagwat Kishanrao Karad, Union Minister of State for Finance; Shaktikanta Das, Governor, Reserve Bank of India; T V Somanathan, Finance Secretary; Ajay Seth, Economic Affairs Secretary; Tarun Bajaj, Revenue Secretary; Sanjay Malhotra, Financial Services Secretary; V Anantha Nageswaran, Chief Economic Adviser, Ministry of Finance; Ajay Tyagi, Chairperson, Securities and Exchange Board of India; Supratim Bandyopadhyay, Chairperson, Pension Fund Regulatory and Development Authority; and Injeti Srinivas, Chairperson, International Financial Services Centres Authority were among the attendees of the 25th FSDC meeting.
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