Let me draw your attention to the preamble of the FEMA, 1999 which very aptly summarises the philosophy behind how we regulate the cross border transactions. It goes: “An Act to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.” 10.
On the first aspect, I believe that supervisory stress tests will bring maximal value to the stakeholder community – both the supervisors and the CCPs themselves, as well as their clients – if they are designed in a way that accounts for the inter-connectedness and the potential spill-over of risk.