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Last Updated : Apr 02, 2020 08:19 PM IST | Source: Moneycontrol.com

Lockdown an opportunity for resetting agenda in financial market reforms: Mark Matthews, Julius Baer

The real economic problem of India, according to him, is that the country's financial system continues to be weighed down by issues like under capitalisation of state-owned banks as well as the "lending scandals" in the private banks and non-banking financial companies (NBFCs).


The novel coronavirus outbreak has battered markets worldwide and it will be sometime before investor sentiment is back to normal.

Amid the ongoing efforts across the globe to contain the spread of the COVID-19, Prime Minister Narendra Modi on March 24 announced a 21-day nationwide lockdown.

This could very well be used as an opportunity to reset the agenda for the financial market reforms in the country, says Mark Matthews, Head of Research-Asia, Julius Baer.

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"While the 21-day lockdown in India has caused much distress, especially in the migrant worker community, it is also a time for a reset of financial market reforms," he said.

Calling the lockdown announced by the Indian government "one of the most draconian containment measures in the world", he said that the same will no doubt have a significant impact on the small and medium-sized enterprises while also giving rise to much distress among the migrant worker community. However, he goes on to say that this move "will have been a worthwhile investment" if the outbreak is suppressed in the country of over 1.3 billion people.

Also Read | Explained: Why India has relatively lesser number of COVID-19 cases

The real economic problem of India, according to him, is that the country's financial system continues to be weighed down by issues like under capitalisation of state-owned banks as well as the "lending scandals" in the private banks and non-banking financial companies (NBFCs).

Matthews goes on to say that maybe the present situation could serve as a catalyst for the country to consider resetting its agenda with respect to financial market reforms, which has so far focussed on "punishing malfeasance" instead of recapitalising the system.

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First Published on Apr 2, 2020 08:19 pm
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