The macro-economic stability of India stays strong on the back of a development in fundamentals, structural reforms with the launch of the GST and steps to tackle the twin balance sheet problems, according to the discussions at a meeting of the Financial Stability and Development Council (FSDC) on Tuesday, 23rd August 2017 chaired by finance minister Arun Jaitley.
The FSDC Council, comprising of regulators and financial ministry secretaries, also took note of investor confidence in financial markets, which is reflected in high and rising bond and stock valuations and long-term positive consequences of demonetisation, according to a finance ministry statement.
Chief Economic Adviser Arvind Subramanian made a presentation on the state of Indian economy at the meeting.
The twin balance sheet problem mentions the overleveraged companies and bad-loan-encumbered banks, which has dented investments in the economy.
Those all who attended this meeting were RBI Governor Urjit Patel, finance secretary Ashok Lavasa, economic affairs secretary Subhash Chandra Garg, financial services secretary Anjuly Chib Duggal, corporate affairs secretary Tapan Ray, Sebi Chairman Ajay Tyagi, Ministry of Electronics and Information Technology (MEITY) Secretary Ajay Prakash Sawhney and IRDAI Chairman TS Vijayan.
The Council also took stock of the progress of the Financial Sector Assessment Programme for India, jointly conducted by the International Monetary Fund and the World Bank. “The Council directed that the assessment report should be finalised by the end of this calendar year,” it said.
The meeting deliberated on the central KYC registry system and discussed the issues and suggestions relating to the operationalisation of the registry. Sebi has already fixed the deadline (December) for associating the Aadhaar with KYC for stock market transactions. The Council also discussed at length on strengthening regulation of credit rating agencies.