Brave New World?
The FLSRC’s recommendations are sweeping, but will not be easy to implement
- Proposal: Merge IRDA, PFRDA, SEBI and FMC into a unified financial agency; frame Indian Financial Code
- Prognosis: Promises equal treatment across firms and products; too many issues foreseen
- Proposal: Monetary policy to be main focus
- Prognosis: Will reduce the burden on the RBI; GOI to reduce central bank’s role in debt management and take capital controls out of its purview
- Proposal: Monetary Policy Committee with five independent external members selected by GOI
- PROGNOSIS: Greater risk of GOI’s political biases affecting RBI’s functioning