Date:09/10/2004 URL: http://www.thehindubusinessline.com/2004/10/09/stories/2004100900600300.htm

Back `Changing mindset is cascading thru banking sector'

Sridhar Krishnaswami

New York , Oct. 8

THE two-day India Investment Forum organised by Euromoney Institutional Investor and sponsored by Merrill Lynch and the State Bank of India group came to a formal close here with both official and private India going to great lengths to draw attention to not only the continuation of the reform process but also in dispelling — to the best of their abilities — some of the apprehensions of potential investors.

If the highlight of Thursday was the presentation of India's Minister for Communications and Information Technology, Mr Dayanidhi Maran, focusing on the telecom sector, the day also witnessed some interesting and detailed panel discussions on different aspects of existing and emerging India — the financial, energy, biotechnology and petroleum sectors.

While much of the attention of the delegates was focused on what participants from India had to say, there was also the interest in what others — those who were already in India, and some for a very, very long time — had to say on what was taking place and what is in store for the future, especially in the services sector.

Pointing to the complexities and dynamism of India in the banking sector, Mr Chris Low, CEO of the India region from the Standard Chartered Bank, made the assessment that although clearly there is some ways to go in India in gearing up to foreign direct investment and foreign institutional investment, the "changing mindset is cascading through the banking sector."

Mr Low made the point that on the question of regulatory reform the Reserve Bank of India, SEBI and the Insurance Regulatory and Development Authority are moving towards the "best practices" of the world but in a phased fashion.

That said he talked about how there was "more transparency" and "discretion" exercised by these top official entities.

"Reforms and regulations are going to progress," Mr Low said.

Even in pointing to the "very positive outlook" in India which had a "attractive investment climate" what was striking in the presentation of the CEO of the SCB was in the kind of advice to potential investors, essentially two-fold: Work very closely with the regulators and engage "all" the stakeholders.

But the bottomline message of Mr Low was even more telling: "Be sensitive."