, which has been carefully crafted. fifth, the extremely complex task of bringing an almost totally unregulated non - banking financial companies sector into a system of focussed regulation of those which accept public deposits. sixth, technological upgradation, which has several dimensions. these include computerisation in rbi and projects for use of banks and financial institutions mainly in the areas of payment and settlement as well as public debt office. rbi also closely monitors upgradation of technology in banks. eighth, and a related measure under implementation is rbi ’ s central database management system, which will become a pioneering project among emerging countries. ninth, there has been an increasing recourse to auditors as a supervisory resource from rbi. finally, to monitor developments in financial markets and take prompt actions a financial markets committee ( fmc ) has been constituted within the rbi which meets at least once a day and often several times during periods of excess activity in the financial markets. the fmc provides crucial inputs in assessment of short - term liquidity and operation of liquidity adjustment facility. fmc also helps in designing of development of financial markets. thus, rbi has not only focussed on a medium term agenda for financial sector reform outlined earlier but has refined and reoriented the agenda from time to time, as warranted by developments. government of india three broad areas were identified as critical for reform viz. fiscal deficit, legislative changes and structural issues affecting public sector banks. undoubtedly, government has devoted some attention in regard to all the three areas, and the measures taken are well known. yet, it will be interesting to recall the relevant budget pronouncements. the budget for 1999 - 2000 concentrated on reform of the banking sector i. e. debt recovery tribunals, restructuring of weak banks, settlement advisory committees, and tax deductibility for provisions made by banks. the reform of capital markets focussed on uti and mutual funds but of interest to financial markets was abolition of stamp duty on transfer of debt instruments within the depository mode. the budget for 2000 - 2001 carried forward reform on public sector banking by announcing intention for a more diversified ownership of public sector banks, establishment of financial restructuring authority, debt recovery, etc. of particular interest are announcements relating to establishment of a credit information bureau and possible legislative amendments to accord greater operational flexibility to the rbi. most important of all was the intention to bring about a fiscal responsibility act. the canvass gets further enlarged beyond public sector banks and fiscal management to development

of debt markets and interest rate flexibility in the budget for 2001 - 02. no doubt, in all the budgets there is progressive liberalisation of capital account. in brief, the budgets over the last three years have contained larger and wider reference to reforms in the financial sector. the canvass is spreading from banks to financial markets. during the period, the regulatory jurisdiction of rbi was fine tuned and clarified through amendments to securities contract regulations act, and enactment of foreign exchange management act. while these are some of the several governmental initiatives, significant changes in legal and institutional framework are necessary for further progress in reform of financial sector. banks elaborating on issues related to banks, in this gathering would certainly be superfluous. suffice it to say that there has been noticeable progress in respect of all the four issues flagged before viz. internal control systems, placement and work practices, flexibility in hiring people and use of technology in banks. however, there is a long way for public sector banks to traverse from current industry - wise approaches to bank - wise autonomy to enhance efficiency and profitability. it may be worthwhile to chart a roadmap for genuine autonomy for public sector banks consistent with principles of good corporate governance. conclusion in brief, a notable part of agenda for reform has been completed and in the process, some items not in the original medium - term agenda became necessary for reform. currently, the focus is rightly shifting to legislation, markets, technology and beyond banks to nonbanks. it is also evident that reforms can succeed only and only if coordinated efforts are made by rbi, government of india and banks, themselves. it must, however, be recognized that key to financial sector reform is banking reform ; key to banking reform is public sector banking reform ; and key to public sector banking sector reform is government ’ s initiative. finally, you would appreciate that, by and large, we in rbi try to be aware of what is desirable and we are implementing whatever is feasible. before concluding, i must mention that the tasks ahead of you listed by the iba are appropriate, complex, and urgent. these are broadly divided into four areas viz. human resources management, technology, structure of banking, and sound banking. the banks ’ sports board, a relatively recent institution has already impressive achievements to its credit and is bound to advance the course of national sports in the coming year also. i have great pleasure in wishing you all the best on this happy occasion. thanking you all again!