Introduction 1991 Financial System Ref he new economic policy of a deregulated en eatures —Control over pricing of finan high transaction costs. politicized, ented regulatory systemFinancial Reform > Broad Issues economi nduce eff price uate’ credit to f growth” countries the most favourable is Intermediaries-based or I her than Capital market based or Direct or ed in most developed countries) {Objectives of Financial Re form Initiation of Financial R eform -As per Raghuram Rajan the recommendation of s ¢ ommiuittee on Financial Sector Reform 1ented, competitive, world integrated sparent financial system ney of available sz the effectiveness, acco tability, viability, vibrancy, balai al economy, depoliticisation and flexibili »mote accelerated growth of the real sectorcontd. To increase the rate of return on real in vestment To promote competition by creating level playing field To dismantle the administrative system of interest the effectiveness of directed credit dernise the instruments of monetary controlMajor Financial Reform The reform introduced at a gradual Pace Secondary Market Reforms Securities Market Reform nancial Market ReformFinancial system in Pre-reform period rnational market= Development of financial system in The governm neil of financial institutionCont. 4. Institutions for financing agriculture * 1963- Agriculture Refinance and Development Corporation. + 1982-NABARD National Bank for Agriculture and Rural Development. Institution for foreign trade EXIM bank Jan. 1982 Institution for housing finance National Housing Bank 1982Impact of Finance ial Reformcontd. ity Adjustment ne market and imparted . Management of liquidity through Liquid Facility - Provided liquidity to tt Stability to financial ma kets wth in foreign ange reserve St costs on corporate sector profits have turned entralisation in Indian financial sy ster private oligopoly and state monopoly vernment securities market enabled bette ment from the second half of the 1990contd. There are some negative observation with respect to financial sector reform : Little improvement in deficit. ‘GDP ratio Depreciation in exchange rate y to external shocks credit delivery system easons of post-reform deficiencies: | economic slow down ard spiral in global assets markets rtainty in global oil-market draught in 2002 s in fiscal structure