Technology, innovation key to inclusive growth of financial sector: DFS secretary

New Delhi [India], December 8 (ANI): A focus on financial sector reforms aimed at creating stability, resilience and efficiency in the financial sector, and based on technology and digitisation, would contribute greatly towards stimulating inclusive growth and help the country to emerge as a developed country by 2047, Dr Vivek Joshi, Secretary, Department of Financial Services (DFS), Ministry of Finance said on Friday.

He was speaking during the session on Strategizing India’s Prosperity: Next Gen Reforms at The Global Economic Policy Forum 2023 organized by the Department of Economic Affairs, Ministry of Finance, Government of India and the Confederation of Indian Industry (CII) on Friday.

Joshi further underpinned the significance of digital public infrastructure for promoting financial inclusion, citing the example of UPI as a game-changing initiative that has gone global; other initiatives such as PMJDY, Jan Dhan trinity; evolution of fintech, move towards formalisation of the economy; among others are other landmark reforms.

“For the MSMEs, schemes such as the mudra scheme, CGTMSE, and ELGLS would go a long way to address their credit-related concerns. Cyber security and protection of digital public infrastructure is an area of concern for which expenditure on financial security should be scaled up and attention be given to data protection as given in the Data Protection Act,” he said.

Joshi based his vision on the rich macro fundamentals that would lead to a rise in per capita income, a robust financial services sector with a highly competitive banking sector with India’s global footprint across continents; lower intermediation costs; efficient access to MSME credit; deepened stock, bond and commodity market; data-driven financial system etc.

“The roadmap for 2047, included average growth of 7-7.5 per cent, rise of domestic savings to 31 per cent of GDP, rise in credit to GDP ratio to 130 per cent, among others,” he added.

He emphasised on the increased use of AI, decentralised financing, data-based lending, emergence of India as a fintech nation, among others.

Arti Ahuja, Secretary, Ministry of Labour and Employment, Government of India highlighted the three major global trends that were impacting the world and would have a spill-over impact on India.

“This includes the process of ageing and demographic change which has increased the demand for geriatric care, fuelled the demand for social security and also resulted in labour shortage due to which countries are cutting public services. Second, new kinds of jobs are being created and the increased reliance on AI. While AI is rationalising jobs in a few sectors, it is also helping humans to improve their competitiveness,” she said, adding that the third is the mainstreaming of the provision of decent work practices in the global value chain.

These include stress on the agility of the workforce and adjustment to new job creation for which a common taxonomy of jobs and skills is required as suggested in G-20, to encourage mobility of workers to where there are skill gaps, accent on formalisation, provision of social security and mapping its coverage, and lastly rationalisation of the inspection system.