India on track to become solid global player due to strong financial regulations: Experts

Kozhikode: India is on the path to become a solid global player due to robust financial regulations, financial experts, including RBI Deputy Governor M Rajeshwar Rao, have said.

The RBI Deputy Governor said India was in a "sweet spot" to grow robustly, despite global turmoil and monsoon risks to growth, and to do so, developing credit markets was essential.

Rao, and the other financial experts, expressed their views at IIM Kozhikode's 'First Annual Seminar on Banking Regulation, Intermediary Soundness and Systemic Stability' held on Monday, a release issued by the institute said.

To address credit risks, Rao said financial intermediaries should consider credit risk as a core element in their strategies.

He called for a framework based on five elements of Ms -- measuring, monitoring, managing, mitigating, and migrating, the release said.

Rao said that for risk transfer or migration, the role of markets was extremely important as a deep and vibrant market to offload credit exposure could mitigate credit risk. He said that the credit market needs to be more "nimbler".

"A dynamic secondary market for loan instruments, a wider base of participants and asset classes in the market and a robust framework for risk assessment would also help," he is quoted as having said in the release.

Rao further said that the market for securitisation products was quickly catching up in India and was poised to grow manifold in the years to come and hinted that the RBI could prune the negative list for asset securitisation.

Professor Debashis Chatterjee, Director of IIM Kozhikode, who also spoke at the event, emphasised upon the importance of better developed financial systems to spur innovation, inclusivity and growth.

He also appreciated the critical role played by RBI in upholding the financial sovereignty of the country.

The other participants, which included MDs and CEOs of banking establishments like South Indian Bank, Muthoot Finance and Federal Bank, were of the view that India was on the path to become a solid global leader due to robust financial regulations.

Indian Institute of Management (IIM) Kozhikode is the fifth IIM to be established in 1996 by the Centre.