For example, while the business environment and infrastructure of a financial centre tend to form a basis for success initially, human capital is more important at centres in more advanced stages of development. At the top end of the scale, the smallest differences in infrastructure can then start to play an essential role again.
The committees favoured consolidation in the Indian banking structure to create well-capitalised, automated and technology-oriented banks through mergers and acquisitions; fostering competition in the banking structure through permitting more private sector banks; setting up of small banks with local character to cater to the requirements of rural and unorganised sectors; more active foreign banks participation; strengthening of the existing structure through enhancing appropriate risk management capabilities; and putting in place legal, insurance, resolution and prudential measures to enable the banking structure to discharge its core functions in an efficient and inclusive manner.