Let me mention in passing the problem of gold, as I realise the gulf region provides perhaps the largest gold market with an Indian connection on the western side. The control on gold imports was imposed with a view to getting an immediate handle on the burgeoning current account deficit. The insatiable Indian appetite for gold is well known.
Since CDS  6  BIS central bankers’ speeches  is a complex derivative product and downside risk is very high, Reserve Bank intends to follow a cautious and gradual approach in the nascent stage of development of the market. As for as capital adequacy guidelines are concerned, Reserve Bank has broadly followed Basel norms.