Indian banking sector is capable of dealing with crisis caused by insolvency of US & European banks – RBI governor Shaktikanta Das

Washington – The world is worried after the bankruptcy of Silicon Valley Bank-SVB of the United States and the Credit Suisse of Switzerland. Warnings are being given that some more banks in the United States and Europe will go bankrupt in the future. Due to this, some economists have warned that an even worse economic crisis than the one that occurred in 2008 will fall on the world. RBI Governor Shaktikanta Das said that while the banking sector worldwide is under threat, the threat to Indian banks is unlikely.

Moreover, the RBI Governor expressed confidence that India’s banking system is resilient, stable and strong. Even if American and European banks go bankrupt, it will not affect the Indian banking sector. Because India’s financial and banking system is fully capable of dealing with these crises, added Governor Shaktikanta Das. As far as banking sector norms are concerned, Indian banks are well-capitalized. Shaktikanta Das also claimed that Indian banks have sufficient liquidity in each bank and the banking system as a whole and have sufficient capacity to withstand financial stress. Due to this, the Indian banking system is completely strong and will not be affected by developments in the US and European banks, the RBI Governor further said.

In the last few years, RBI has taken appropriate measures to strengthen and stringent its system. This includes supervising and controlling the banking system and non-bank financial sector companies. We have not allowed the time to take such measures until the economic crisis. Shaktikanta Das further said that RBI has already taken sufficient vigilance to ensure that a financial crisis does not occur. These statements about India’s banking sector are noteworthy by Shaktikanta Das, who is visiting the United States with Union Finance Minister Nirmala Sitharaman.

While the banks of the United States and European countries are in financial crisis due to their bankruptcy, the world will face a new financial crisis, not only economists but also the World Bank and the International Monetary Fund are warning. In such a scenario, the confidence expressed by the Reserve Bank Governors that Indian banks can face this crisis becomes very important. This will increase the credibility of the Indian economy at the international level.

Developed countries are now showing interest in doing business in Indian Rupee. India is emerging as a reliable economy even in times of financial uncertainty and there are indications that Indian banks can withstand financial crises more robustly than developed countries. This can greatly increase the flow of foreign direct investment in India. At the same time, in the near future, more intense competition will be ignited in almost all countries to develop economic cooperation with India. Union Finance Minister Nirmala Sitharaman and Union Commerce Minister Piyush Goyal are constantly clarifying this.

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