A meeting of the Sub Committee of the Financial Stability and Development Council (FSDC) was held today in Mumbai. Dr. D. Subbarao, Governor, Reserve Bank of India, chaired the meeting. The meeting was attended by Dr. Arvind Mayaram, Secretary, Department of Economic Affairs (DEA); Shri D. K. Mittal, Secretary, Department of Financial Services (DFS); Shri U. K. Sinha, Chairman, Securities and Exchange Board of India (SEBI); Shri J. Harinarayan, Chairman, Insurance Regulatory and Development Authority (IRDA); Deputy Governors of RBI, Dr. K.C. Chakrabarty, Dr. Subir Gokarn, Shri Anand Sinha and Shri H. R. Khan, Shri G. Gopalakrishna, Executive Director, RBI and other officials.

The Sub-Committee reviewed the recent developments in the global economy, specifically in the Eurozone and the US. The concerns on slowing growth, persistent inflationary pressures and pressures on the external sector front were discussed. The risks to stability of the domestic financial system including the developments in the banking sector were briefly reviewed.

The Sub Committee discussed issues related to rising gold imports and its impact on the current account deficit, introduction of financial instruments to increase the productive use of gold held in the economy, implications of the US Foreign Account Tax Compliance Act, use of the Business Correspondent to sell other financial products and the risks involved, regulatory gaps in the shadow banking in the country, etc.

Ajit Prasad
Assistant General Manager

Press Release : 2012-2013/459