and the international finance corporation. my personal observations show that many of us, in asia, could study and learn from the public policies in mauritius relating to high coverage and quality of primary education, efficient delivery of health services and protection of environment. yes, we have a lot to learn from each other and there are many areas in which we can cooperate. the two central banks will, i am sure, strengthen the traditional ties. we will carry forward a continuous dialogue to strengthen cooperation between the bank of mauritius and the reserve bank of india. as a reciprocal gesture, let me extend an open and standing invitation to governor bheenick to visit india soon and, in addition, participate in the celebrations of 75th anniversary of the reserve bank, which is due soon in a couple of years from now. thank you all, ladies and gentlemen.

how much to tighten and when, is more a question of good judgement rather than analytical skill. this judgement skill is the one that central banks, especially in developing countries such as india, need to hone as they simultaneously pursue the objectives of growth and financial stability. fourth challenge : reforming regulatory architecture as the lessons of the crisis emerge, central banks are vigorously reinventing themselves and almost all countries are reviewing their regulatory architectures. two key lessons are driving this change : first that the responsibility for financial stability cannot be fragmented across several regulators ; it has to rest unambiguously with a single regulator, and that single regulator optimally is the central bank. and second, that there is need for coordination across regulators on a regular basis and for developing a protocol for responding to a crisis situation. i want to address three issues in the broad area of regulatory architecture. the first issue has to do with regulatory coordination. in india, we have a host of regulators in the financial sector – rbi, sebi, irda and pfrda. in order to facilitate coordination between them, there is a high level coordination committee on financial markets ( hlcc - fm ) comprising all the regulators and the finance secretary. while the governor of the reserve bank chairs the hlcc - fm, the ministry of finance provides the secretariat. the hallmark of the hlcc meetings, and one that adds most value to them, is that the meetings are informal and there is free exchange of positions, views and opinions. there is a view that the hlcc - fm should be given a formal structure. while a formal structure will have the merit of enforcing accountability, the flip side is that it may make the forum excessively bureaucratic and detract from its other value adding features. this is an issue that we must debate further. one area where the hlccfm could have a more defined role relates to oversight of large financial conglomerates. the second issue relating to regulatory architecture with relevance for financial stability has to do with changes, if any, warranted in the regulation of financial markets. two recent reports, both influential, one by percy mistry on mumbai as an international financial centre and the other by raghuram rajan on financial sector reforms, have recommended that regulation of all trading of financial products and instruments be brought under sebi. we need to seriously debate the advisability of such a unification. currently, the arrangement for regulation of financial markets is as follows. apart from banks