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प्रश्न
Why did RBI have to change its role from controller to facilitator of financial sector in India?
उत्तर
- Prior to liberalisation, RBI used to regulate and control the financial sector that includes financial institutions like commercial banks, investment banks, stock exchange operations and foreign exchange market.
- With the economic liberalisation and financial sector reforms, RBI needed to shift its role from a controller to facilitator of the financial sector.
- This implies that the financial organisations were free to make their own decisions on many matters without consulting the RBI.
- This opened up the gates of financial sectors for the private players.
- The main objective behind the financial reforms was to encourage private sector participation, increase competition and allowing market forces to operate in the financial sector.
- Thus, it can be said that before liberalisation, RBI was controlling the financial sector operations whereas in the post-liberalisation period, the financial sector operations were mostly based on the market forces.
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