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All is well for India

A strong regulatory architecture would prevent the global financial meltdown’s contagion from spreading to India, the country’s regulators feel, reports Sandeep Singh.

business Updated: Oct 03, 2008 21:44 IST
Sandeep Singh

A strong regulatory architecture would prevent the global financial meltdown’s contagion from spreading to India, the country’s regulators feel.

The heads of the regulatory authorities of the four financial sectors — banking, capital markets, pensions fund and the insurance met on Wednesday and have also decided to meet on a monthly frequency to take an overall view of the entire system.

“The idea is to meet and discuss things regularly,” said one of the regulators.

The regulators, however, did not see a need for any fresh measure to be adopted, as the impact of global financial crisis is minimal.

An official said, “We can see the virtue of a conservative government policy now.”

The government has not permitted insurance and pension money to be invested abroad and has also capped the investment exposure in the equity market. However, this should not continue forever and should change as the Indian financial system grows and matures.

“The government has been slow on current account convertibility and it should continue that way till the time our financial system matures.”