CURRENT AFFAIRS

ECONOMY

1. Financial Sector Reforms :

a. Selling various financial products at one place confuses customer, and may end

up buying wrong product.

b. Moreover, in case of grievance, customers are send one place to another, as

selling financial product authority is one agency but this products are regulated
by various authorities and it becomes easy to transfer their responsibility to one
another.
c. Therefore, budget 2015 proposes to setup unified financial redressal agency with
all financial sector law having focus on customer. This body is setup under
recommendation of financial sector legislative reform commission. It might be an
independent body to foster greater trust among customers and better and
healthy practice among sellers.

2.

Rate cuts and foreign capital flow:

a. Foreign capital flow is double edge sword:
i. Increasing foreign capital flow increases countries trust level,
ii. Increasing capital flow increases Indian rupee value and hence making export
uncompetitive.
b. Foreign capital naturally flow to areas where interest rates are high, therefore cutting
interest rate is best non-inflationary move.