Business
Foreign Banks Push for Regulatory Relief in India: Lower Risk Weights & Easier PSL Norms
EEST TV Business Desk — In a significant push to ease regulatory burdens, leaders of foreign banks in India have presented several key requests to the Reserve Bank of India (RBI). Their demands include lowering risk weights for exposures to multinational corporations (MNCs) and relaxing the norms for priority sector lending (PSL) — changes that could unlock more flexibility and capital for banks operating in the country.
This move has sparked intense discussion across the banking and financial ecosystem, with support from some quarters and concerns from others. Let’s break down what foreign banks are asking for, why they want it, and what it may mean for Indian banking and the economy.
In a recent formal meeting with RBI Governor Sanjay Malhotra, CEOs of several foreign banks urged regulatory changes to make their operations in India more growth-friendly. Their primary proposals included: