The last decade has witnessed major changes in the financial sector: New banks, new financial institutions, new instruments, new windows, and new opportunities and, along with all this, new challenges. While deregulation has opened up new vistas for banks to augment revenues, it has entailed greater competition and consequently greater risks.
These included, inter alia, replacement of quantitative controls by tariffs, partial decontrol of fertilizer prices, removal of bottlenecks in agricultural marketing, relaxation of restrictions of the Essential Commodities Act, 1955, replacement of the Revamped Public Distribution System (RPDS) with Targeted Public Distribution System (TPDS), and establishment of Rural Infrastructure Development Fund (RIDF). Moreover, price reforms improved terms of trade for agriculture.