crisis of 2008. then too, we faced similar extreme siege conditions of the global financial system, and the challenge of responding immediately and decisively to the crisis within the boundaries of democratic processes. we managed that challenge. the g - 20 ’ s leadership and the all - out efforts mounted by the imf and other multilateral institutions to do what it takes to pull back the global economy from the brink of collapse and set it on a path of recovery were applauded across the world. 9. there are important differences between the 2008 crisis and today ’ s situation. i. in 2008, when the world got into a crisis, there was a lot of policy force. in the years before the crisis, the world enjoyed the so called “ great moderation ” with steady growth in advanced economies and accelerated growth in the emerging economies, and low inflation all around. so we could attack the crisis with the full fire power of monetary and fiscal stimulus. sadly, the policy space for stimulus is much less today. ii. in 2008, the world responded to the crisis in coordination. sure there were differences, but these differences were resolved, and governments and central banks acted firmly, decisively and where required creatively. a similar perception of coordination is lacking today. iii. in 2008, both advanced economies and emdcs were at the same phase of the business cycle. today, they are at different phases of the business cycle. iv. in 2008, the crisis originated in the financial sector and transmitted to the real sector, but the rescue was by the public sector. in 2011, it is the other way round. the crisis is originating in the public sector and hitting the financial sector, and undermining the confidence of the private sector. 10. let me now conclude. there is a great deal of anxiety around the world about the outcome of this weekend ’ s fund - bank annual meetings and the g - 20 meetings. there are strong expectations that we will converge on a plan of action that will reverse the crisis of confidence. we once again have to show the resolve that we did in 2008 to meet those expectations. bis central bankers ’ speeches

subir gokarn : perspectives on financial sector strategy keynote address by dr subir gokarn, deputy governor of the reserve bank of india, at the high level panel on opportunities and challenges for financial services in india and europe, new delhi, 20 september 2010. * * * the inputs of b. m. misra, pallavi chavan and rakhe p. b. in preparation of this address are gratefully acknowledged. i welcome this initiative by the asia - europe business forum to organize a discussion on opportunities and challenges for financial services in our respective regions. virtually all significant debate that is taking place today on financial sector regulation and development, whether in advanced or emerging economies, is placed in the context of the crisis and the role that the financial sector played in it. however, there is a significant asymmetry in that debate, as is evidenced, for example, in the discussions on post - crisis financial regulatory strategies in the g20 process. it is by now fairly clear that significant differences in regulatory frameworks across countries contributed to very different outcomes in terms of both the role of national financial sectors in the crisis and, in turn, the impact of the crisis on the financial sectors themselves. within the g20 process, this has resulted in concerns about a “ one - sizefits - all ” regulatory response to the crisis. however, on a more constructive note, it has also contributed to the emergence of a collective view on balancing the role of the financial sector in the development process with the need for global co - ordination on regulation in the face of increasing global integration of both financial systems and economies as a whole. this “ emerging market perspective ” was the subject of a seminar organized in seoul as a prelude to the recent g20 finance deputies meeting in gwangju, korea, earlier this month. i believe that this perspective provides an important foundation for sustaining a meaningful dialogue between advanced and emerging economies, of which this forum is an example. in this brief keynote address, i would like to put forward some thoughts on the broad principles that guide our thinking on financial sector development and which have shaped our contributions to the “ emerging market perspective ” that i referred to earlier. on previous occasions, i have articulated four basic principles : efficiency, stability, transparency and inclusion. an effective strategy would need to balance the objectives implicit in the four principles by, first, exploiting the complementarities between them and second, recognizing the tradeoffs and, wherever they arise, prioriti