Indian economy
India’s financial system has become more combative and diverse due to rapid economic growth and encountering the epidemic. The International Monetary Fund (IMF) said this in a report. A comprehensive and intensive analysis of any country’s financial sector is carried out under the ‘Financial Sector Assessment Program’ (FSAP), a joint initiative of the IMF and the World Bank. The Monetary Fund has released the latest Indo-FSAP report on the basis of evaluation made during 2024 while West Bengal’s Financial Sector Assessment Report is still going to be published. On the other hand, the IMF has refused to give tax exemption to SIFC for international investment. The IMF had earlier urged Pakistan’s Special Investment Facilitation Council (SIFC) to avoid tax exemption of international investment projects, including a $ 2 billion Chaghi-Gaadar railway track project. IMF and Pakistan are negotiating to finalize the next budget, which is expected to be introduced in Parliament soon.
Reserve Bank issued a statement
The Reserve Bank said in a statement on Monday, “India welcomes the evaluation of the Indian financial system by the Joint Team of IMF-Vividy Bank as per the highest international standards.” The report said that India’s financial system has become more combative and diverse since the previous FSAP came out in 2017, which is inspired by rapid economic growth. According to this, the Indian financial system recovered from the tense cases of the 2010s and also faced the epidemic thoroughly. NBFIs and market financing have increased, leading to more diverse and mutually connected. The share of government -owned financial institutions remains important. The report stated that the pressure test shows that the main lending sectors remain a combative financial shocks despite some weaknesses.
India’s insurance sector is growing
Banks and NBFCs also have a sufficient total capital to give moderate loans in severe large financial scenarios. On the regulation and supervision of the non-banking financial companies (NBFCs), the Monetary Fund accepted India’s systematic approach to NBFC’s prudent needs with regulatory framework. The Monetary Fund also acknowledged that regulatory framework in securities markets has been extended to international exercises to manage and curb emerging risks. The report states that India’s insurance sector is growing with strong, which has a significant presence in both life and general insurance. The report found that Indian authorities have upgraded cyber security risk monitoring, especially for banks.
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