Central bankers are known for choosing each word when speaking publicly with many ending up talking but not telling much. It was therefore a welcome relief for the corporates and leaders from the banking and financial sector that Reserve Bank of India governor Sanjay Malhotra opted to both speak and also convey in no uncertain terms the approach of the central bank to regulations.
Ten days after India celebrated its 79th Independence, speaking at the ‘FIBAC 2025’, organized jointly by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the Indian Bank’s Association (IBA) on Monday August 25th in Mumbai, Malhotra said, “generations of freedom fighters gave us a Svatantra (free) Bharat and we need to work for a Samridh (prosperous) Bharat.” On this journey, while he urged the corporate sector and banks to drive the animal spirits and create a much-needed investment cycle, he also spoke of the central bank continuing with its endeavour to consolidate all the regulations for various categories of regulated entities.
Industry welcomes RBI’s proactive stance
Former FICCI president Dr Habil Khorakiwala, who as the founder chairman, Wockhardt, is today leading the race in drug discovery with novel antibiotics, said, “the RBI governor came across as one with a positive attitude and keen on relevant regulations which in today’s context is both timely and apt. We need to simplify regulations as that alone will enable faster decision-making and ensure investible fund flows that the country needs today.”
Seated next to Dr Khorakiwala was Naina Lal Kidwai, also the former FICCI president and the former country head of HSBC India. She underlined the emphasis laid by the governor on the importance of digital platforms to encourage financial inclusion and innovation while ensuring systemic resilience and consumer protection. She also referred to the governor’s focus on the end-customer and how it pointed to “the proactive nature of RBI’s approach to the evolving issues.”
Focus on regulatory review and balanced growth
The RBI governor who had spoken at the Financial Express organised FE Modern BFSI Summit, 2025 last month (in July) and explained how the RBI was approaching constant review of regulations, reiterated the point yet again and of the move to “set up a Regulatory Review Cell with the mandate to review each regulation in a comprehensive, objective, systematic and structured manner.”
The governor also reminded the regulated entities that they and the regulator may seem to be operating from opposite sides with the former seeking growth and the latter for financial and price stability but that both shared similar objectives and vision for a ‘Viksit Bharat’ as there is no tussle between growth and financial and price stability leading to sustainable growth.
All eyes are now apparently on the form and shape many of these approaches are to take in the evolving regulatory scenario and perhaps help soothe the nerves fraying over what next to expect in global trade and on the implications for both the developed and emerging economies.