to be good plumbers and electricians rather than unemployable low - skilled engineers. in fact, teaching our citizens can be a stepping stone to teaching the world. india can be at the forefront of providing mass technology - enabled education with our professors providing appropriate human inputs to achieve the best mix of automation and customisation for learning. 3 ) we need better business regulation. this does not always mean less regulation but it means regulation that is appropriate to the objective and, that is enforced. entrepreneurs tell me about boiler inspectors showing up at software outfits, asking for the location of the boiler. the lack of change may be sheer inertia, but it may be more sinister rent - seeking. all too often, we have too much regulation on the books and too little regulation in practice, with the worst of the regulated finding unscrupulous ways around the regulation while the honest are stymied. even opening a business legitimately requires an enormous number of clearances and paperwork. in the same way as we have saral form for filing income tax, could we have a saral one page disclosure for opening a small business, with a single authority giving all necessary permissions? bis central bankers ’ speeches 4 ) and finally, we need a better financial system, which will finance the needed infrastructure and the expansion of every producer ranging from the kirana shop owner to the industrialist. but finance is not only about credit. equally important is for households to be able to save safely with positive real returns, insure themselves against health emergencies or old age costs, and borrow at low cost to finance consumption. they should be able to make remittances cheaply and pay at low cost. importantly, the financial system should not require constant subsidies to bail it out. in the rest of this talk, i want to focus on what we, at the reserve bank, are doing to improve the financial system. we plan to build the reserve bank ’ s developmental measures over the next few quarters on five pillars. these are : 1. clarifying and strengthening the monetary policy framework. 2. strengthening banking structure through new entry, branch expansion, encouraging new varieties of banks, and moving foreign banks into better regulated organizational forms. 3. broadening and deepening financial markets and increasing their liquidity and resilience so that they can help allocate and absorb the risks entailed in financing india ’ s growth. 4. expanding access to finance for small and medium enterprises, the uno

for important elements of prudential regulations set by the reserve bank. the capital and leverage ratios, liquidity position, the computation of impairment and provisions, etc. rely on the accurate and transparent financial statements prepared by regulated entities. the financial statements can only be accurate when the accounting standards are correctly interpreted and consistently applied. the auditors are guardians who are expected to ensure the sanctity of this process. they are also 1 / 5 bis - central bankers'speeches the bridge between the management and stakeholders. they ensure that management's judgement is sound and that the entity adheres to spirit of the accounting standards. the interest of the regulator is not limited to fair and transparent representation of affairs in the entities regulated by it. banks and financial institutions are also users of financial statements and to a large extent their well - being in linked to the entities which they lend to or invest in. therefore, we are equally concerned with sound audit practices that result in high quality corporate reporting. we also monitor developments in the area of national and international accounting and auditing standard setting closely. with these objectives in mind, we continue to work closely with the institute of chartered accountants in india ( icai ) on accounting issues in the banking sector. in october 2001, the rbi had set up a working group under the chairmanship of shri n d gupta, the then president of the icai, to identify gaps in compliance with accounting standards. based on the recommendations of the group, guidelines were issued to banks in march 2003 to ensure compliance with accounting standards. we had also worked closely with the industry and icai on the road map to moving towards adoption of ind as and had set up a working group to deal with ind as implementation issues in banks. role of auditors in a principle - based regulatory environment the reserve bank, for some time now, has been supplementing rule - based regulations with principle - based regulations to give res a degree of flexibility in their business decision making. this process has evolved with indian financial sector achieving greater maturity. the principle - based regulations also embed an aspect of accounting that would reflect a move away from the prescriptive, rule based criteria to record transactions. let me cite two recent examples. the first guideline pertains to classification and valuation of the investment portfolio in banks. the revised norms, effective from april 1, 2024, largely align the guidelines on classification, valuation and operations of investment portfolio of banks with the global financial reporting framework. these norms require banks to