Mumbai: A sound and
resilient banking sector, well-functioning financial markets, robust
liquidity management and payment and settlement infrastructure have
become the pre-requisites for financial stability, union Finance
Minister Pranab Mukherjee said here Sunday.
Speaking at the second Sir Sorabji Pochkhanawala Memorial Lecture
organised by the state-owned Central Bank of India, Mukherjee said
the global financial crisis has compelled the policy makers to
rethink some of the principles of economic management.
"In the post-crisis period, financial stability and the banking
system have become integral part of policy discussions and
macroeconomic objectives in the developed and the developing world,"
"We have seen how unfettered growth of the financial sector can have
dangerous implications -- both in the developed and the developing
worlds," he added.
Mukherjee observed that the fact that India has not gone through any
financial turbulence and survived the global crisis reflects the
mature economic management of the country.
"Today, it's well established that our commercial banks are well
regulated, vibrant, fast-growing and match the global best practices
in capital adequacy, risk management and business growth," he said.
He lauded the Indian banks for doing a commendable job in meeting
the vast banking and credit requirements of an economy growing at
around nine percent in the last few years.
Mukherjee, however, regretted that the fruits of banking have not
been distributed universally.
"Financial inclusion is a key determinant of sustainable and
inclusive growth, which in turn is essential for building an
equitable society. A major unfinished task in this context is to
promote greater financial literacy and investor protection," he
Mukherjee also launched the 'Cent Kisan Gold Card', an initiative of
the Central Bank of India. The smart card aims to provide single
window hassle-free financial support to farmers for farm and
Sir Sorabji Pochkhanawala had founded the Central Bank of India Dec
21, 1911. It was claimed to be the first Indian commercial bank
completely owned and operated by Indians. The Indian government
nationalised the bank, along with 13 others, in 1969.