Apropos Debashis Basu's column "A Swachh Financial Sector Abhiyan?" (Irrational Choice, November 17), the call for cleansing the Indian financial sector has come at the right time.
The Indian banking system, more particularly public sector banks (PSBs) as a group, has been the target of criticism for all the ills in the financial sector. The previous finance minister and spokespersons from the finance ministry had given an impression that the financial sector would be relieved of all ills by implementing the report of the Financial Sector Legislative Reforms Commission (FSLRC). This column exposes the weaknesses of the FSLRC report and stresses the need for viewing the financial sector as one entity that manages public funds, irrespective of the sources.
The inadequacy in regulatory apparatus and arrangement for resolution of grievances of depositors and borrowers outside the banking system is a serious issue mentioned in the column. A closer look at the issues raised in the column and changing the focus from destabilising the existing regulatory and supervisory mechanism to sharpening the tools used to improve the functioning of the financial sector could bring back the lost credibility.
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