As we and financial institutions gain experience, and as new technologies ensuring security emerge, we can liberalize further. More generally, our philosophy is to allow innovation in institutions, instruments and practices so long as they do not present a clear and present danger.
Once we understand them better, and they grow to a material size, we can do a deeper analysis on how they should be regulated. Similarly, we have been allowing more and more participation in derivative markets by what are typically known as speculators – those without an underlying risk they are hedging. Speculators are much maligned in India and often confused with market manipulators.