Over-regulation likely in financial sector: RBI Deputy Governor

The financial industry of the country is likely to see over-regulation in the coming years. In fact, regulation is the reason why the Indian financial sector is surviving, said K.C. Chaktabarty, Deputy Governor of Reserve Bank of India, who was in the town to participate in the financial leadership summit organised by the Indian Institute of Management Lucknow. The programme was part of the three-day annual management festival celebrated by the institute, called Manfest 2011. Chakrabarty, in his speech, said the financial market cannot be made totally free in an environment where there is lack of transparency and understanding about the sector is less among its consumers. Chakrabarty said 40 per cent population of the country is still without a bank account. “But by 2030, all Indians will have a bank account,” he said. K.C.Chakravarty, who was also one of the panelist spoke about financial inclusion and regulation. He quipped, "If you are an economist and have committed any sin, then in your next life, you would be a central bank governor of a developed country." Financial market, he said, will have to be subservient to real market in 2030. "Financial market is surviving in this market only because of regulators," he said, stressing that financial regulation will remain vital to the economy. "If there is one country that has the opportunity in the 21st century it is us. We must seize the opportunity," he said.