Financial stability and development council
Q. Which of the following is/are true regarding Financial stability and development council?
1) It is an organ of NITI Aayog.
2) It monitors macro prudential supervision of the economy.- Published on 14 Nov 16a. Only 1
b. Only 2
c. Both 1 and 2
d. Neither 1 nor 2
ANSWER: Only 2
- Financial Stability and Development Council is an apex-level body constituted by the government of India.
- The idea to create such a super regulatory body was first mooted by the Raghuram Rajan Committee in 2008.
- Finally in 2010, the then Finance Minister of India, Pranab Mukherjee, decided to set up such an autonomous body dealing with macro prudential and financial regularities in the entire financial sector of India.
- The global economic meltdown has put pressure on governments and institutions across the globe to regulate their economic assets. This council is seen as India's initiative to be better conditioned to prevent such incidents in future.
- The new body envisages strengthening and institutionalising the mechanism of maintaining financial stability, financial sector development, and inter-regulatory coordination along with monitoring macro-prudential regulation of economy.
