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Financial Sector Reforms in Developing Countries: The Indian Experience
Author(s) -
Arun T. G.,
Turner J. D.
Publication year - 2002
Publication title -
world economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.594
H-Index - 68
eISSN - 1467-9701
pISSN - 0378-5920
DOI - 10.1111/1467-9701.00440
Subject(s) - financial sector , deregulation , economics , premise , context (archaeology) , competition (biology) , economic reform , politics , dimension (graph theory) , financial stability , finance , financial deepening , developing country , financial system , market economy , financial intermediary , economic growth , political science , paleontology , ecology , linguistics , philosophy , mathematics , pure mathematics , law , biology
This study is based on the premise that the success/failure of financial sector reforms depends heavily on country specific factors and makes an attempt to examine these factors in the Indian context. The financial sector reforms analysed in this paper include the deregulation of interest rates, increasing competition and foreign ownership, and the introduction of financial supervision. We argue that an economic rationale for a gradualist approach to financial reform is that it is stability enhancing. Furthermore, we suggest that India’s complex political economy has resulted in a gradual approach to reform, and this approach has been successful along the dimension of banking stability.