to remove long - standing structural impediments to strong, sustainable and balanced global growth going forward by launching its signature “ mutual assessment process ” which is increasingly seen as the heart and soul of the g 20. the success of this process is important for global financial stability, as i will explain later. during the crisis, the leaders met twice a year. now, the frequency has reverted to the standard pattern of once a year. post - crisis, seven leaders ’ summits have been held : washington ( november 2008 ), london ( march 2009 ), pittsburgh ( october 2009 ), toronto ( june 2010 ), seoul ( november 2010 ), cannes ( november 2011 ) and los cabos ( june 2012 ). brazil, russia, india, china and south africa comprise the brics. bis central bankers ’ speeches main issues on the g 20 agenda in that context of the origins and importance of g 20, let me now turn to some of the main issues on the g 20 agenda after the world surfaced from the depth of the 2008 / 09 global financial crisis. i will also give the indian perspective where appropriate. global rebalancing the first issue i want to address is global imbalances. almost everyone is agreed that one of the root causes of the global financial crisis is the build - up of global imbalances. in as much as global imbalances – no matter whether they were caused by a “ consumption binge ” in advanced economies or a “ savings glut ” in emes – were the root cause of the crisis, reducing imbalances is a necessary condition for restoring global financial stability. the post - crisis debate on global imbalances has three interrelated facets. the first is the role of exchange rates in global rebalancing. the second relates to capital flows into emes raising the familiar challenge of managing the impossible trinity. and the third facet is the framework for the adjustment process. let me turn to these one by one. first, on the role of exchange rates – a prime lever for redressal of external imbalances. global rebalancing will require deficit economies to save more and consume less. they need to depend for growth more on external demand which calls for a real depreciation of their currencies. the surplus economies will need to mirror these efforts – save less and spend more, and shift from external to domestic demand. they need to let their currencies appreciate. the problem though

financial institutions ( or sifis ), and assessment of the implementation of new standards. so far, one pillar that has received substantial public attention is regulatory reform, where there have already been some notable achievements, including agreement on the new basel iii capital and liquidity standards. however, the process of regulatory reforms that is proceeding across various jurisdictions has come to pose new challenges especially as the global economy continues to be marked by new risks. the uncertain and uneven recovery has led to calls in some quarters to dilute or slow the financial reform initiatives. while there may be a case for some back loading of difficult adjustments to strengthen the recovery of the financial sector, any weakness in our resolve or commitment to reform will sow the seeds for a fresh crisis down the line. the key task is therefore to fully implement what has been agreed in a cooperative manner. all g 20 members have committed to the implementation of the basel iii package. however, major jurisdictions have come out with their own regulatory standards. it is important that there is no disharmony that could be confusing. we need to guard against the possibility of regulatory arbitrage. if comparable standards are not implemented in all jurisdictions simultaneously, financial activity will likely migrate to less regulated jurisdictions as well as into shadow banking with disruptive consequences for the entire global financial system. as we move forward in the area of regulation, the investment needs of the emerging market and developing economies also deserve special attention. there are two important points in this regard. first, it is important to ensure that financial intermediaries in emerging and developing economies are not disadvantaged in the new regulatory framework, especially since the opportunities and challenges in their systems are quite different. second, the more demanding regulatory standards should not lead to deleveraging by global financial institutions out of emerging markets. it should be noted in this regard that the financial regulatory reform has so far focused on reducing systemic risks, and rightly so, but not much attention has been devoted to redirecting savings from investment in volatile financial assets to financing investment in the real economy, where the impact on growth and jobs is more tangible and direct. we need to recognize that it is income from the real sector that must ultimately pay for the profits of the financial sector. standards setting bodies should design incentives in a manner that helps redirect global savings into investment in the real economy, particularly in infrastructure, supports demand and enhances long - term potential growth thereby fulfilling the original role of intermediating for growth and development of the