Finally, the exchange rate is flexible but volatility has been and is being checked by the Reserve Bank of India. Financial Sector As most of you may be aware, we have adopted international standards of capital adequacy for banks, and their non-performing assets are closely monitored with a view to bringing them down. In particular, I would like to emphasise some major features.
First, our banks’ total exposure to assets of Asian and East Asian countries was less than $ 500 million, and foreign liabilities are well below 10 per cent of total liabilities. Second, lending to property is frowned upon and is generally restricted to housing finance.