public authorities can contribute to financial integration by developing a common technical infrastructure. it is no coincidence that in the areas where such common infrastructure is missing, then integration is less well developed. the repo market, which is still hampered by a multitude of securities clearing and settlement systems, gives a still unfortunate example of that phenomenon. another example is the adoption of the eonia rate, which underscores how market participants play an important role in fostering financial integration through the adoption of market conventions. the eonia rate, which stands for euro over - night index average, is the effective interest rate in the euro unsecured overnight interbank market. the technical definition and the procedures for calculation of the rate have been defined by market participants through a series of market conventions, which were key for the integration of this market segment. in this respect, i should also mention that ecb has a role in the process because it fixes the eonia rate as a service to the banking sector. this illustrates that public bodies can indirectly foster financial integration by acting as a facilitator in private sector initiatives. the third challenge is the design of public standards for risk management. weaknesses in clearing and settlement arrangements can be a source of systemic risk. it is therefore paramount that effective risk management standards are applied by clearing and settlement systems. however, competition entails the risk that the service providers might try to improve competitiveness by applying more lenient risk management standards. given the potential systemic effects of the failure of a major clearing and settlement system, the operators might assume that central banks will eventually bail it out and they might therefore not have sufficient incentives to address risks effectively. against this background, the ecb takes the view that the establishment of public standards for risk management is essential. in fact, the eurosystem has set such standards that securities settlement systems need to comply with in order to be eligible for the use in our credit operations. all interested parties should be actively involved in the development and implementation of such standards. at the g10 level, standards for securities settlement systems have been developed by a joint task force in which both the committee on payment and settlement systems ( cpss ) and the international organisation of securities commissions ( iosco ) are represented. the fruitful experience gained in this co - operation has encouraged similar work at the eu level. for this purpose, the escb has established a framework for co - operation with the committee of european securities regulators ( cesr ), primarily aimed at assessing how the

duvvuri subbarao : the imf and economic developments in the indian subcontinent statement by mr duvvuri subbarao, governor of the reserve bank of india, to the international monetary and financial committee ( imfc ), washington dc, 24 april 2010. statement on behalf of mr pranab mukherjee, finance minister of india and member imfc representing the constituency consisting of bangladesh, bhutan, india and sri lanka. * * * mr. chairman : 1. confounding our worst fears, the turn around in the global economy has been much faster than we had anticipated as recently as only a few months ago when we met in istanbul. the global economy has experienced three quarters of positive growth following the sharp declines in the first quarter of 2009 and in the preceding quarter. there is, however, considerable heterogeneity in the pace of the upturn in different countries with emerging and developing countries leading the way. the global economy 2. although the global outlook is more reassuring than it was a few months ago, uncertainty about the shape and pace of global recovery persists. while macroeconomic risks have decreased, vulnerabilities remain. there is growing concern about the deterioration in the sovereign risk profile and dangers posed to financial stability in some countries. it is often said that every financial crisis is followed by a sovereign debt crisis because of the public sector ’ s support to affected parts of the economy. will this time be different? recent developments have shown the merits of a gradualist approach to allowing external financing of fiscal deficits. the crisis and the post - crisis experience should usher in some rethink on how and by how much debt markets be opened up for external financing. 3. volatile capital flows have been a central issue during the crisis, and continue to be so now as the crisis is ebbing. emerging market economies ( emes ) saw a sudden stop and reversal of capital flows during the crisis as a consequence of global deleveraging. now the trend has reversed once again, and many emes are seeing net inflows – a consequence of a global system awash with liquidity, the assurance of low interest rates in advanced economies over “ an extended period ” and the promise of growth in emes. capital flows can also potentially impair financial stability. the familiar question of how emes can maximize the benefits and minimize the costs of volatile capital flows has returned to haunt the policy agenda. 4. the recent crisis has clearly been a turning