Ultimately, our goal is to help ensure that the banking sector serves its traditional role as a shock absorber to the financial system, rather than an amplifier of risk between the financial sector and the real economy. The Committee will promote multiple and reinforcing lines of defence in supervisory and risk management frameworks to enhance bank resilience.
Governor, Dr. Subbarao, encapsulated in his remarks the complex nature of the issues involved in the recent innovations in the conduct of monetary policy, most of which could be experiments, and how these may influence the mainstream monetary policy frameworks, going ahead. Here, one has to look up to guidance from eminent thinkers like Prof Stiglitz.