In the process, the investor base for government securities would be broadened, extending the monetary transmission across new players and participants. For monetary policy to be more effective, the monetary transmission process has to be improved on a continuous basis so that price discovery is better.
In this endeavour, we need to keep developing the various financial markets, increase their connection with credit markets, remove distortions in the market and reverse current tendency to move back to administered interest rates. IV. Development of financial markets  There has been a great deal of progress in developing the money market, government securities market and forex market.