The Daily Brief IMF’s New Take on India – Surprising?
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Apr 1, 2025 Discover the IMF's surprising insights on India's booming economy and its critical global role. The podcast dives into India's enhanced financial resilience since 2017, spotlighting strict regulations and the rise of digital systems. It also discusses the IMF's evaluation highlighting progress and ongoing risks, especially in the power sector and climate change. Furthermore, learn about the function of asset reconstruction companies in tackling bad loans and the encouraging trends in loan recovery within the retail sector.
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IMF's FSAP and India
- The IMF assesses systematically important countries' financial systems through the FSAP.
- India's inclusion signifies its potential global impact, as issues in its markets could affect other countries.
Improved Financial Stability
- Indian banks have improved their capital adequacy ratios, enhancing their ability to withstand losses.
- NBFCs also show similar improvements, and are now subject to a scale-based regulatory framework.
Remaining Risks
- Despite improvements, India's financial system still faces risks, including power sector issues and climate change.
- Public sector banks remain a vulnerability due to their potential struggles during economic downturns.