China and India: learning from each other : reforms and policies for sustained growth, Òîì 2005

Cover......Page 1
chiind1......Page 2
Contents......Page 4
Foreword......Page 6
Preface......Page 10
Acknowledgements......Page 16
Part I. Financial Sector Reforms: Banking......Page 18
1. Banking Sector Reform in India......Page 20
History of Bank Regulation in India......Page 21
Reforms of the 1990s......Page 23
Post-1991 Reforms: Developments in the Indian Economy and Their Impact on the Banking System......Page 25
Likely Developments in the Economy After 2005 and the Impact on the Banking System......Page 35
Suggestions for the Reform Process......Page 37
Appendix......Page 42
Bibliography......Page 47
2. Reforming China’s Banking System: HowMuch Can Foreign Strategic Investment Help?......Page 50
China’s Banking System: Progress in and Priorities for Reform......Page 53
Encouraging Strategic Foreign Investment in Chinese Banks......Page 71
What Attracts Foreign Investors to Chinese Banks?......Page 74
What Are the Main Concerns for Foreign Investors in Chinese Banks?......Page 78
Concluding Comments......Page 83
Glossary of Abbreviations......Page 85
Appendix I. A Chronology of Reform 1978–2007......Page 86
Appendix II. Selected Financial Statistics......Page 93
Appendix III. Regulators in the Chinese Financial System......Page 96
Appendix IV. Case Study: Hongkong and Shanghai Banking Corporation’s (HSBC’s) US$1.75 Billion Investment in the Bank of Communications (BoCom)......Page 97
Bibliography......Page 98
General Comment......Page 101
The Role of the Banking Sector in the Economy......Page 102
The High Degree of State Ownership in the Banking Sector......Page 103
The Robustness of the Banking Sector......Page 104
The Robustness of the Banking Supervisory System......Page 105
Part II. Financial Sector Reforms: Securities Markets......Page 108
4. Development of the Securities Market in India......Page 110
References......Page 130
Appendix X Daily Return and Volatility: Select World Stock Indices......Page 129
Appendix IX Trends in Mobilization of Funds by the Mutual Fund Industry......Page 128
Appendix VIII Volume: Trends in Foreign Institutional Investors (FIIs) Investment......Page 127
Appendix VII Volume: Derivatives Segment at National Stock Exchange (NSE)......Page 126
Appendix VI Volume: Cash Segment of Bombay Stock Exchange (BSE)......Page 125
Appendix V Volume: Cash Segment of National Stock Exchange (NSE)......Page 124
Appendix IV Major Reforms in the Secondary Market......Page 123
Appendix III Major Reforms in the Primary Market......Page 122
Appendix II Securities Regulations and Guidelines in Effect......Page 121
Appendix I Fact Sheet on the Indian Capital Market......Page 120
Primary Market......Page 114
Regulatory Efficacy......Page 113
Financial Infrastructure......Page 111
5. Development of Securities Markets: The Indian Experience......Page 131
Corporate Securities: The Equity Segment......Page 132
Corporate Securities: Debt Segment......Page 139
Government Securities Market......Page 144
Assessment of Reforms and Future Challenges......Page 148
References......Page 151
Inadequacies of the Current Policy on Opening Up the Securities Industry......Page 152
Conclusion......Page 158
Harms of Opening Up Slowly......Page 157
Acceleration of Opening Up Internally......Page 156
Recommendations to Accelerate Opening Up the Securities Industry......Page 155
Unfounded Concerns About Opening Up the Securities Industry Faster......Page 154
Part III. Financial Integration......Page 159
7. Domestic Financial Liberalization and International Financial Integration: An Indian Perspective......Page 161
Domestic Financial Liberalization......Page 163
International Financial Integration......Page 178
Appendix I......Page 189
Appendix II Types of Capital Transactions Possibly Subject to Control......Page 191
Appendix III Indices of Exchange Controls, 1996......Page 193
References......Page 194
8. Putting the Cart Before the Horse? Capital Account Liberalization and Exchange Rate Flexibility in China......Page 197
The Case for Exchange Rate Flexibility......Page 200
Capital Account Liberalization......Page 206
The Foreign Exchange Market......Page 209
Considerations of Timing......Page 210
Concluding Remarks......Page 211
Bibliography......Page 212
Part IV. Other Policies for Sustaining Growth......Page 216
9. Some Apparent Puzzles for Contemporary Monetary Policy......Page 218
Some Apparent Puzzles......Page 220
Possible Explanations......Page 230
The Way Ahead......Page 239
Bibliography......Page 243
10. Fiscal Policy in China......Page 246
Overview of the Budget......Page 248
Assessing the Stance of Fiscal Policy......Page 249
China’s New Fiscal Priorities and Their Impact on the Budget Balance......Page 253
11. Labor Mobility in China and India: The Role of Hukou, Caste, and Community......Page 256
Industrialization and Social Structure......Page 259
Social Structure and Labor Mobility......Page 266
Bibliography......Page 273
Part V. Indo-China Economic Cooperation......Page 277
12. Indian Economic Development and India-China Cooperation......Page 279
13. India-China Economic Cooperation......Page 284
India-China Trade......Page 285
Future Potential......Page 290
Barriers and Constraints......Page 292
Next Steps......Page 294
Bibliography......Page 295