A macro-prudential approach recommends that regulators and supervisors should consider potential systemic risk and the vulnerabilities of the environment in which financial institutions act. It will be fundamental to understand the interaction that exists between the financial system and the real economy.
Second, we have political system stability in India though there have been coalition governments at the federal level. We are aware that most of the currency crises in developing countries occurred around the times of political elections, particularly in countries with the presidential form of government. Our experience in India is that political cycles have had a relatively muted impact on financial stability.