e rit ar et in ndia 14.31
IMF-World Bank Financial Stability Assessment BCBS®20and IMF21, India is actively participating
Programme (FSAP) was conducted for India in in post-crisis reforms of the international
January 2013 which assessed Indian financial regulatory and supervisory framework under
system in relation to the highest international the aegis of the G20. India remains committed
standards. The assessment recognises that the to adoption of international standards and best
Indian financial system remained largely stable practices, in a phased manner and calibrated to
on account of a sound regulatory and supervisory local conditions, wherever necessary, as it is a
regime. However, the assessment identifies some country characterised by complex and diverse
socio-political and economic conditions.
gaps in18 —
(i) International and domestic supervisory finAnciAl Action tAsk force (fAtf)
information sharing and co-operation;
The FATF is an inter-governmental policy making
(ii) Consolidated supervision of financial body that has a ministerial mandate to establish
conglomerates; and international standards for combating money
(iii) Some limits on the de jure independence laundering and terrorist financing. India joined the
of the regulators (RBI and IRDA). FATF as its 34th member in June 2010. At present,
Despite having reservations on few issues, the FATF has 36 members comprising 34 countries
overall the Indian authorities expect the FSAP and two organisations (European Union and Gulf
exercise to play a significant role in shaping India’s Cooperation Council).
post-crisis initiatives to strengthen the regulatory 20. The BCBS (Basel Committee on Banking Supervision)
and supervisory architecture based on the provides a forum for regular cooperation on banking
supervisory matters. The Committee’s members, today,
evolving international consensus as well as careful come from 27 nations including India. The present
Chairman of the Committee is Stefan Ingves, Governor of
examination of their relevance in the India- Sveriges Riksbank. It is located at the Bank for International
specific context. As a member of the FSB19 , Settlements (BIS) in Basel, Switzerland.
Its objective is to enhance understanding of key
18. RBI, 16th January, 2013 supervisory issues and improve the quality of banking
19. The FSB was established in April 2009 as the successor supervision worldwide. It seeks to do so by exchanging
to the Financial Stability Forum (FSF). The FSF was information on national supervisory issues, approaches
founded in 1999 by the G–7 for enhancing cooperation and techniques, with a view to promoting common
among the various national and international supervisory understanding. At times, the Committee uses this common
bodies and international financial institutions so as to understanding to develop guidelines and supervisory
promote sta ility in the international financial system. n standards in areas where they are considered desirable.
November 2008, the leaders of the G–20 countries called In this regard, the Committee is best known for its
for a larger membership of the FSF. As announced in the international standards on Capital Adequacy (i.e Basel I,
G–20 Leaders Summit of April 2009, the expanded FSF Basel II and Basel III, by now); the Core Principles for
was re-established as the Financial Stability Board (FSB) Effective Banking Supervision; and the Concordat on
with a roadened mandate to promote financial sta ility. cross-border banking supervision.
The FSB is chaired by Mark Carney, Governor of the Bank The Committee encourages contacts and cooperation
of Canada. Its secretariat is located in Basel, Switzerland, among its members and other banking supervisory
and hosted by the Bank for International Settlements. authorities. It circulates to supervisors throughout the
Its objective is to coordinate at the international level world both published and unpublished papers providing
the wor of national financial authorities and international guidance on banking supervisory matters. Contacts have
standard setting bodies and to develop and promote the been further strengthened by an International Conference
implementation of effective regulatory, supervisory and of Banking Supervisors (ICBS) which takes place every
other financial sector policies. Source: Financial Stability two years. Source: BIS, Basel, Switzerlad].
Board Secretariat, Bank for International Settlements, 21. See Chapter 16 for detailed discussion on the IMF
Basel , Switzerland]. (International Monetary Fund).