us reach consensus on all of the issues on the table for discussion. we have a long history of working together and reaching remarkable useful consensus on critical issues when it matters most, this time will be no different. honourable ministers and governors i am sure we have all had a very hectic day on discussing all these issues and look forward to a very relaxed evening. for those that have not had time to look around this beautiful and historic city i implore you to find time to explore our beautiful beaches and various historic sites. i wish you fruitful deliberations and hope that freetown would forever be remembered as the venue where key decisions affecting the african continent would be made. i thank you.

able to increase their tier 1 capital by an annual average of nearly 30 per cent while their risk weighted assets increased over this period by more than 26 per cent, of which about one fourth has been from internal generation, small amount from government and most of it from the capital markets. assuming the same growth in risk weight assets going forward, and given the average return on capital for the indian banks, raising capital from the markets may not be a problem. given the requirement of basel iii to have common equity as the dominant part of tier i capital, and tier i to be the major part of regulatory capital, and given that indian banks are already well placed in this respect, it would be advisable to retain the advantage even though the new norms will kick in only in a phased manner. forward looking provisioning 7. in a growing economy facing global and domestic shocks, it is likely that npas will increase and the npa ratio could go up and down. the issue, however, is whether the margins on earning assets are sufficient to make adequate provisions for expected losses, apart from generating internal accruals to support growth in the risk weighted assets. in this context, making forward looking provisions as is being considered at the basel level is extremely important for a country like india. while we have asked banks to achieve at least a pcr of 70 per cent for npas, we are also working on a scheme based on the spanish dynamic provisioning model for evolving norms for provisioning for standard assets in different sectors based on time series and cross sectional data. such provisions envisage setting aside profits in good times which can be used in down turn and provide greater comfort from financial stability perspective when the economy is pushing forward for higher growth. lending to infrastructure 8. aspiration for higher growth implies much more investment in infrastructure. needless to say, the headroom available in government finances either at the state or central level for funding or for guarantees ( explicit or implicit ) is limited. this calls for funding from both financial institutions and capital markets, both domestic and external. the single borrower and group borrower exposure limits of banks have already been relaxed to allow for more funding for infrastructure by indian banks. taking into account the concentration risk and asset - liability mismatches, any further relaxation would be imprudent. from regulatory point of view, interest rate derivatives – both otc and exchange traded – have been allowed and these provide the opportunity to hedge the interest rate risk. liquidity requirements on