Indian economy: financial sector reforms and development

Indian economy has been experienced impressive growth rates since 1991 economic reforms. These reforms have been most effective in the financial sector. The financial markets have developed and are more integrated after the reforms. This paper provides a general overview of the impact of economic reforms on financial stability with a view to enhancing productivity, efficiency and international competitiveness of the economy. It covers the developments in banking, external sector and financial markets. Attention is focused on the benefits and risks for financial stability associated with changes in financial markets and the banking system. The paper concludes some with policy implications with regard to monetary policy.