European Union told to trust local rules
RBI governor Shaktikanta Das on Wednesday said that regulators in the developed world need to trust the rules in India — in his first public comment with regard to the decision of the European Securities and Markets Authority (Esma) to derecognise six Indian clearing houses.
Das said that the Indian market infrastructure complies with all the international standards. ``I think, it is also necessary for regulators on the other side to appreciate the credibility, they must trust the credibility and strength of the Indian regulations. That is what we are trying to impress upon them.” Das pointed out that India is different from what it was more than 10 or 30 years ago and the regulations here are robust.
In late October, Esma announced that it will stop recognising six major clearinghouses that includes ClearingCorporation of India Ltd (a trading platform for G-Secs)from April 1, 2023, which was followed by a similar move from the Bank of England.
RBI deputy-governor T.Rabi Sankar, who had earlier said that the move was an “unfortunate interference”, said that discussions were on in the matter and that the central bank hopes to reach an understanding.
“The fundamental point of divergence remains the fact that an Indian entity that does not operate in the European Union and operates entirely in India is being subjected to regulation by an EU regulator. This holds good for a few others as well,” Sankar said.