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Indian Central Bank Relaxes Foreign Bank Rules

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India’s central bank has unveiled new rules that will allow foreign banks to expand their presence in the country.

Foreign banks will now be allowed to set up “wholly owned subsidiaries” in India, which will enable them to open branches anywhere in the country.

The subsidiaries will need a minimum capital of 5bn rupees ($80m; £50m).

The changes are a part of the push by the central bank’s new governor, Raghuram Rajan, to liberalise the sector as he looks to boost growth.

Foreign banks have long wanted to boost their presence in the country – home to nearly 1.2 billion people.

However so far they have had to face tight regulations, especially over the number of branches they can open.

The Reserve Bank of India said the new rules would allow them to open branches “at par with Indian banks”.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
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