april 17, 2020 ) ; “ it is when the horizon is the darkest and human reason is beaten down to the ground that faith shines brightest and comes to our rescue " ( may 22, 2020 ) ; and similar other quotes. 14. in particular, i would like to refer to my december 2023 statement following the macro prudential measures undertaken on november 16, 2023 : “ financial stability is a public good … …. we do not wait for the house to catch fire and then act. prudence at all times is our guiding philosophy. ” the spirit behind these statements are key to withstanding a period of multiple crises. our communication was backed up by appropriate policy actions. evidently, communication played a critical role in maintaining stability in the turbulent times of recent past. robust regulation and supervision for stability 15. it goes without saying that a sound regulatory framework for the regulated entities ( res ), together with a robust supervisory and monitoring mechanism, are key enablers for ensuring financial stability. from a prudential perspective, so far 5 financial stability was also described as a public good in nani palkhivala memorial lecture ( das, shaktikanta ), january 16, 2021 as the reserve bank is concerned, measures like the revised norms on classification and valuation of investments ; the scalebased regulation for nbfcs ; revised regulations for micro finance loans ; four - tiered regulatory approach for urban cooperative banks ( ucbs ) ; and steps to contain potential credit exuberance in unsecured loans are some illustrations of prudential design of regulations in the interest of maintaining financial stability. 16. looking ahead, the financial system will continue to face newer challenges. there is a continuing need for financial sector entities to strengthen their levels and quality of capital, while further sharpening the risk management standards. the reserve bank is now working on issues like adoption of revised basel iii standards in a phased manner ; issuance of guidelines for expected credit loss ( ecl ) ; liquidity coverage ratio ( lcr ) ; and prudential framework for financing of project loans. our overall approach is consultative. for instance, with regard to the ecl framework, even after issuing a discussion paper and receiving stakeholder comments which we got examined by an external working group, we now propose to issue a draft circular for implementation of ecl. the idea is to get stakeholder comments on certain specifics of the framework considering its significance for the banking sector. our endeavour is to maintain a

per global trade outlook and statistics, wto, october 2024. the imf has projected world trade volume to increase by 3. 1 and 3. 4 per cent in 2024 and 2025 respectively ( world economic outlook, october 2024 ). been to maintain financial stability, which breeds growth and prosperity. 7. in 2019, we faced severe stress in the non - banking financial company ( nbfc ) sector. liquidity had dried up and there was a crisis of confidence in the financial markets. there were also certain instances of bank stress, both in commercial and cooperative banking sectors, in recent years. in all these exigent situations, the reserve bank took effective measures to stem the crisis from snowballing and restore stability and confidence in the markets. in parallel, we strengthened our regulatory architecture and supervisory vigil to proactively identify weaknesses and be future ready. it is, therefore, appropriate to reflect on our experience during this period, not just – if i may say so – as a success story but, more importantly, to draw lessons for the future. 8. when the covid - 19 pandemic hit us, our response was swift and decisive. we put in place business continuity measures even before the nation - wide lock down was announced. we set up a special quarantine facility, with about 200 officers, staff and service providers, to ensure continuity in financial market operations and payment systems. all regulated entities were advised to take immediate contingency measures to ensure business continuity and manage their risks. monetary policy and liquidity operations 9. monetary policy has completed a full cycle in the last six years – an easing cycle during 2019 - 22 and a tightening cycle of equal magnitude thereafter. we have used the flexibility embedded in flexible inflation targeting ( fit ) to prioritise growth or inflation depending upon the prevailing conditions and the outlook. for instance, when economic activity came under severe stress during the covid - 19 pandemic, we prioritised growth over inflation and cut policy rates and infused huge liquidity into the system. these measures were nuanced, keeping in mind the price and financial stability challenges that may arise in future. in addition, forward guidance during the easing phase complemented and reinforced monetary policy and liquidity measures. in parallel, appropriate regulatory measures, consisting of moratorium on repayment of loans and resolution frameworks for stressed loans were also announced. 10. later, when the russia - ukraine war caused massive supply disruptions in