Describe the development of India's financial sector over the last Essay

get out the development of Indias financial sector over the last decade. Support your claims with as much as information possible - Essay Examplen India 2003-04, talks about the appropriate timing of the entry of irrelevant blasphemes into India so as to be co-terminus with the transition to greater capital account convertibility (Thankur, 1990).This shows that the economic policy origination in India, including the RBI, has not drawn adequate lessons from the experiences of the financial crisis-affected countries. Besides, banks are the principal risk carriers in the system, winning in small deposits that are liquid and making relatively large investments that are illiquid and can be characterised by pregnant income and capital risk. The observed tendency among some promoters or boards of banks to divert a substantial share of its deposits into speculative activities in which the promoter or board may be interested or into investments that are risky but promise quick returns, can increase financial fragility, lead to bank failures and if the magnitude of the failure is serious enough, can actually precipitate crisis for the entire financial system (Thankur, 1990).Instances in India such as the Nedungadi Bank and the Global Trust Bank are the harbingers of what may follow if reckless deregulation of the banking sector is carried out. In fact, the experience of recurrent financial crises in the 1990s, most famously the east Asian experience, has shown how banking deregulation along with capital market liberalization often serves as recipes for financial fervour in developing countries (Desai, 1987).Many guidelines have stated among other things that no single entity or collection of related entities would be allowed to hold shares or exercise control, directly or indirectly, in any confidential sector bank in excess of 10 % of its paid-up capital. Recognising that the 5th March notification by the Union Government had hiked foreign investment limits i n private banking to 74%, the guidelines sought to define the roof as applicable on aggregate foreign investment in private banks from all sources (FDI, inappropriate