Indian financial markets: Convergence and integration

Abstract

In the last decade there have been three major trends in the global financial markets which are of utmost importance to the emerging countries. One is the convergence of different financial services wherein the banking sector, securities industry and insurance business are being conducted by the same institution. The second is the significant increase of the role of information technology particularly Internet in these activities, which provide clues to the extinction of traditional intermediation. The third is the global reach of these instruments and institutions which brings to focus the inadequacies of the existing premises and policies of the national regulatory authorities. The major issue in countries like India is the existence of segmented markets which poses challenges of integration and also the need for inclusive growth. This paper focus on the issue of integration and whether it would facilitate orderly and inclusive growth.