Financial Sector Reforms

The approach to financial sector legislative reforms by the government seems to be derived from the recommendations of the Financial Sector Legislative Reforms Commission (henceforth, commission) under the chairmanship of Justice B N Srikrishna. The then Finance Minister, Pranab Mukherjee, announced the setting up of the commission during his Budget Speech of 2010–11. He stated:

Most of our legislations governing the financial sector are very old. Large number of amendments to these Acts made at different points of time has also increased ambiguity and complexity. The Government proposes to set up a Commission to rewrite and clean up the financial sector laws to bring them in line with the requirements of the sector.

The terms of reference of the commission were wide-ranging, suggestive of the scope for thorough overhaul of financial sector laws. The commission completed this onerous task within the given time frame of 24 months and submitted its report in March 2013. Though the commission was set up by the United Progressive Alliance (UPA) government, the responsibility of following up fell upon the new Bharatiya Janata Party-led government with Arun Jaitley as the finance minister.