RBI governor cautions against debt waiver schemes
26/08/2014 07:26
The Reserve Bank of India Governor, Raghuram G. Rajan on Monday said cautioned against debt waiver schemes announced by State Governments, citing that it has adverse impact on the financial health of the banks whose capital needs have gone up due to enhanced prudential requirements and deterioration in asset quality and the macro economy in general. Speaking at the 27th Conference of the State Finance Secretaries, Rajan stressed on the need to strengthen the State Level Coordination Committees (SLCC) by ensuring participation at the higher level, conducting meetings at more frequent intervals and ensuring and sharing of quality information among all the stakeholders including the state government agencies, RBI, SEBI and MCA. “SLCCs should focus on financial inclusion for flow of public savings to the formal channels and protection of deposits of public mopped up by unauthorised and unscrupulous entities”, he said. Addressing the conference, Rajan also highlighted the challenges faced by the country last year in tackling the serious issues relating to Current Account Deficit (CAD), growth slowdown, fiscal consolidation and inflation management and steps taken to restore confidence in the macro economy of the country. The Reserve Bank holds the conference of State finance secretaries every year to discuss and arrive at pragmatic solutions to the problems relating to State finances.
26/08/2014 07:26
The Reserve Bank of India Governor, Raghuram G. Rajan on Monday said cautioned against debt waiver schemes announced by State Governments, citing that it has adverse impact on the financial health of the banks whose capital needs have gone up due to enhanced prudential requirements and deterioration in asset quality and the macro economy in general. Speaking at the 27th Conference of the State Finance Secretaries, Rajan stressed on the need to strengthen the State Level Coordination Committees (SLCC) by ensuring participation at the higher level, conducting meetings at more frequent intervals and ensuring and sharing of quality information among all the stakeholders including the state government agencies, RBI, SEBI and MCA. “SLCCs should focus on financial inclusion for flow of public savings to the formal channels and protection of deposits of public mopped up by unauthorised and unscrupulous entities”, he said. Addressing the conference, Rajan also highlighted the challenges faced by the country last year in tackling the serious issues relating to Current Account Deficit (CAD), growth slowdown, fiscal consolidation and inflation management and steps taken to restore confidence in the macro economy of the country. The Reserve Bank holds the conference of State finance secretaries every year to discuss and arrive at pragmatic solutions to the problems relating to State finances.
