Gradualism also enables harmonisation with reforms in other sectors of the economy. A wide range of regulatory and institutional reforms were introduced in a planned manner over a period to improve the efficiency of financial markets.
These included development of market micro structure, removal of structural bottlenecks, introduction/ diversification of new players/instruments, free pricing of financial assets, relaxation of quantitative restrictions, better regulatory systems, introduction of new technology, improvement in trading infrastructure, clearing and settlement practices and greater transparency. Prudential norms were introduced early in the reform phase, followed by interest rate deregulation and gradual lowering of statutory pre-emptions.