wake of recent developments. time does not permit me to go into it here, but it is important to point out that the different policy responses we saw across emes to the volatility in capital inflows were largely the outcome of their exchange rate policy framework. countries that orient their exchange rate regimes to export competitiveness typically have current account surpluses. this is a characteristic of the asian emes and, in this sense, india is a significant exception to the asian rule. these surpluses are reflected in a build - up of foreign exchange reserves, which may be further enhanced by large inflows of capital and the further accumulation of reserves to prevent currency appreciation, which undermines competitiveness in the short run. in the current global context, when capital inflows stop, reserves built up from current account surpluses provide the capacity to manage exchange rates in the face of external pressure. india has large reserves, of course, over $ 300 billion, but because we have a current account deficit, the reserves are essentially counterbalanced against our external liability position. in an extreme scenario, if there is a large outflow of capital, the adequacy of reserves will be judged by the economy ’ s ability to finance the current account deficit and, over and above that, meet short - term claims without any disruption or loss of confidence. in light of this, the value and use of reserves in the indian context must be viewed somewhat differently than in the context of a structurally current account surplus economy. reserves essentially provide comfort to external counterparties that we have the capacity to meet our obligations. while the recent sharp depreciation has in certain quarters led to an assessment of “ helplessness ” in dealing with the kind of global turbulence we are seeing today, our strategic behavior should not be misconstrued as an inability to lean against the wind. consider the following alternatives. not using reserves to prevent currency depreciation poses the risk that the exchange rate will spiral out of control, reinforced by self - fulfilling expectations. on the other hand, using them up in large quantities to prevent depreciation may result in a deterioration of confidence in the economy ’ s ability to meet even its short - term external obligations. since both outcomes are undesirable, the appropriate policy response is to find a balance that avoids either. that balance can be found in precisely the structural capital controls that i referred to earlier. resisting currency depreciation is best done by increasing the supply of foreign

, including with respect to : governance, where firms will be expected to embed fully the consideration of climate risks into governance frameworks, including at board level, and assign responsibility for oversight of these risks to specific senior role holders ; risk management, where firms will need to consider climate change in line with their boardapproved risk appetites ; the regular use of scenario analysis to test strategic resilience ; and developing and maintaining an appropriate disclosure of climate risks. recognising the need for industry to build capacity and to develop best practices, the pra has established a climate financial risk forum, jointly with the fca, to work with firms from across the financial system. 11 the responses to our supervisory consultation reflect the urgency and significance of the issues. perhaps for the first time in financial regulation, firms are both thanking their supervisors for raising an issue and pushing us to go further ; with some asking for more prescriptive recommendations and others for mandatory disclosures. 12 certainly, while climate risk management is improving, there is more to do particularly when assessing strategic resilience. for companies, that means conducting scenario analysis. the tcfd 2018 status report found that non - financial industries ( energy, transport, building and agriculture ) were the most advanced at measuring strategic resilience, including some examples of scenario analysis. 13, 14 the tcfd review found that the financial sector is also moving toward enhanced strategic analysis. for example half of all insurance companies reviewed used the 2°c scenario, and the majority of banks described the potential impact of climate - related issues on their businesses. prudential regulation authority. ( oct 2018 ). consultation paper on enhancing banks ’ and insurers ’ approaches to managing the financial risks from climate change. available : https : / / www. bankofengland. co. uk / prudential - regulation / publication / 2018 / enhancingbanks - and - insurers - approaches - to - managing - the - financial - risks - from - climate - change. prudential regulation authority. ( march 2019 ). pra and fca ’ s joint climate financial risk forum. available : https : / / www. bankofengland. co. uk / news / 2019 / march / first - meeting - of - the - pra - and - fca - joint - climate - financial - risk - forum. forthcoming april 2019 as described in tcfd september 2018 report : these companies disclose the inputs to and