According to Mr. Namo Narain Meena, Minister of State for Finance, RBI is processing applications of 18 foreign banks, which have shown interest in setting up branches and representative offices in the country. As on June 30, 2010 more than 300 foreign bank branches are present in the country.
Responding to a query on whether allowing foreign banks setting up base in India would effect domestic banks, he said the RBI was preparing a discussion paper on the impact and would take some time before coming up with the final recommendations on granting new licences to banks.
When asked whether the RBI had decided to review the status of financial sector to see if it was ready for further liberalisation, Meena said that the system needed to grow in size and sophistication. He said that besides this, there was a need to extend the geographic coverage of banks and improve access to banking services.
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