India should capture all segments of financial market to boost growth: IMF

India is on the right track and is innovating on the policy side, including digital identity and payments, but it also needs to capture all sectors of the financial market and institutions to ensure that every piece fits together like That fuel growth according to a top IMF official in the country.

“The goal is an economy and a financial system that can absorb shocks. ..Balance sheets can be managed better, non-performing loans (NPLs) can be managed better, ”Tobias Adrian, director of the Department of Money and Capital Markets of the International Monetary Fund (IMF), said Told PTI in the interview.

The non-bank financial system can be seen better, and capital markets will have to deepen and strengthen more, he said during last week’s annual spring meeting of the IMF and the World Bank. Of course, there is also the entire fintech agenda, which is important in India because it is everywhere in the world.

“We are in a technological revolution in the payment space. And I think India has been a pioneer in many of these technologies and payment systems. Now there is lending which is done in India which is not done anywhere else because the infrastructure in this area is quite strong. But of course, more can be done, ”Mr. Adrian said in response to a question.

The IMF official underscored the importance of investing in financial institutions, and in infrastructure to ensure that “the financial system can absorb shocks and sustain growth over a long period of time”.

India said, it is on the right track and is innovating on the policy side.

“It is quite innovative on digital identity, for example. I think no country is speaking like India in that context, ”he said, adding that the country needs to capture all areas of financial markets and financial institutions to ensure that every piece of development in India Fits like a puzzle to promote.

The general lesson from the COVID-19 crisis, he said, is when a terrible adverse blow requires one to aggressively supply liquidity.

Secondly, fiscal support was very important in this particular crisis and certainly depends on how much fiscal space each country has. Third, financial sector policies have certainly been very successful. Debt moratoriums, especially interest rate payments for that loan, are fully compatible with regulatory and accounting flexibility, he said.

“Therefore, we were very curious about the measures that were used in building the flexibility of what banks could do and what other lenders could do to support borrowers through the epidemic so that they could earn interest. Pay and resume principal. Payment once the crisis is over, ”said Mr. Adrian.