financial stability. india is no exception to this practice. the economist based its conclusion on the standard parameters such as current account, budget balance, inflation and increase in bank lending, for assessing the degree of risk and one cannot disagree with the relevance of these parameters in assessing risks. but, most of these risky elements have been a part of the functioning of the indian economy for several years, almost all through the reform period, and yet the economy exhibited macro - stability and impressive growth even while withstanding some significant domestic and global shocks. in view of this evidence, we need to explore a ) the reasons for such risks not materialising in our economy so far ; and b ) the measures needed, in future, for insulating the economy from such risks, to the extent feasible. the reform process in india, lays emphasis on appropriate sequencing of reforms. firstly, the reserve bank, in particular, has been treating reforms in financial and external sectors as means to broader objectives of accelerated growth with stability rather than as ends in themselves. secondly, reform in external sector makes a clear distinction between the costs and the benefits of trade liberalisation, and between the risks and rewards of capital account liberalisation. thirdly, a hierarchy in capital flows is recognised and management of capital account is advocated on that basis. fourthly, the pace and content of reform in financial and external sectors are calibrated after taking into account reforms in real, fiscal and public sector as a whole. these approaches to reform have had a salutary impact on the preparedness of financial institutions, financial markets, public policy and above all, public opinion to participate gainfully in the reform process. way forward, there is considerable merit in persisting with these approaches that have ensured macro - stability, while fine tuning them to the changing times and global challenges. reserve bank will, in regard to both growth and stability, continue to pursue its policy of being enlightened by theory, educated by global experiences, and conditioned by domestic realities without being bound by any particular ideology. a major area of vulnerability for us is the high consolidated public - debt to gdp ratio of over seventy percent and persisting, though moderating, consolidated fiscal deficit. the policies and practices in management of public - debt in india are acutely conscious of these and hence policies to mitigate risks on this account are carefully crafted by taking recourse to all the instruments at the command of the reserve bank in a coordinated manner. at the same time, reforms in government

indian economic society today. let me conclude by appreciating the idr 2008's emphasis on macro - stability. while there is no visible immediate threat to financial stability in our country, at this juncture, we recognise the need for continued but heightened vigilance. we believe in taking timely, prompt and appropriate measures to mitigate the risks, to the extent possible, being conscious of difficult dilemmas. let me also reiterate the continued commitment of the reserve bank to lay stress on macro - economic stability in a way that it enhances the prospects, not merely for accelerated growth but for a genuinely more inclusive growth. the need for such a continued commitment of public policy is, i believe, the main message from the india development report 2008. it is my honour and privilege to release the india development report, 2008. thank you.