As equilibrium interest rates have declined, so has the interest rate that is stimulatory. Estimating equilibrium rates is tricky, and estimates are subject to bands of uncertainty.
Strengthening banking structure through new entry, branch expansion, encouraging new varieties of banks, and moving foreign banks into better regulated organizational forms. 3. Broadening and deepening financial markets and increasing their liquidity and resilience so that they can help allocate and absorb the risks entailed in financing India’s growth. 4.