shaktikanta das : accelerating financial market reforms in india address by mr shaktikanta das, governor of the reserve bank of india, at the 4th annual day of foreign exchange dealers ’ association of india ( fedai ), 26 november 2020. * * * 1. i wish to thank fedai for inviting me on the occasion of their 4th annual day. this is an opportune moment to look back and reflect on the developments of the last one year in financial markets and, in particular, the foreign exchange markets. the year 2020 has been one like never before. faced with an unknown crisis which brought the global economy to a sudden stop, recent policy discourse has been dominated, and rightly so, by the impact of the pandemic. despite this, regulatory and institutional reforms in the country have moved the domestic financial markets to the next trajectory. cutting across market segments, these reforms are ushering in a simplified, principle - based regulatory framework that seeks to broad - base markets by easing access, enhancing participation, facilitating innovation, protecting users and promoting fair conduct. today, i would like to discuss the imperatives and the building blocks of the recent reforms placing them in the context of the big picture of a modern and efficient financial market, equipped to support the aspirations of an open and integrated economy. 2. given that we are still amidst the pandemic, where near - term macro concerns dominate the discourse, let me start with a few words on the macroeconomic outlook and financial market conditions. macroeconomic outlook 3. after witnessing a sharp contraction in gdp by 23. 9 % in q1 : 2020 – 21 and a multi - speed normalisation of activity in q2, the indian economy has exhibited stronger than expected pick up in momentum of recovery. the global economy has also witnessed a stronger than expected rebound in activity in q3. the imf has accordingly revised its assessment for global growth in 2020 to a less severe contraction than what was assessed in june 2020. 4. even as the growth outlook has improved, downside risks to growth continue due to recent surge in infections in advanced economies and parts of india. we need to be watchful about the sustainability of demand after festivals and a possible reassessment of market expectations surrounding the vaccine. the monetary policy guidance in october emphasised the need to see through temporary inflation pressures and also maintain the accommodative stance at least during the current financial year and into the next financial year. 5. a key

i have attempted to set out today the broad themes which have guided the liberalization / reform agenda for financial markets. the recent changes are aimed at enabling financial markets to enhance allocational efficiency in the use of resources and thereby contribute to economic development. with this freedom comes responsibility. the achievement of desired outcomes is contingent on financial institutions and market participants taking forward the reform agenda so that we have vibrant financial markets and efficient financial intermediation. the simplification and flexibility provided in the regulations must reach the end - user. in designing new products and new market segments, risk management systems and responsible market conduct should evolve in tandem as we open up to global players. market participants and their associations including fedai will have to play a critical role in this. 5 / 5 bis central bankers'speeches