Banks’ role will have to be foundational to sustain India’s growth trajectory: Former IRDAI chief

Former IRDAI chief stresses banks' foundational role in India's growth, urging innovation and support for sustainable financing initiatives.

Retired IAS officer and former chairman of Insurance Regulatory and Development Authority of India (IRDAI) Debasish Panda on Wednesday, February 18, said if India’s growth trajectory is to remain elevated for the next two decades, the role of banks will have to be foundational and not peripheral.

He was delivering the founders’ day lecture at the Karnataka Bank headquarters here. To achieve the goals of Viksit Bharat 2047, banks should finance manufacturing expansion, energy transition, urbanisation and digital entrepreneurship, thereby funding both physical and intellectual capital, he said.

Karnataka Bank Chairman P. Pradeep Kumar and managing director and CEO Raghavendra S. Bhat present a memento to former IRDAI chairman Debasish Panda, who delivered the Bank’s founder’s day lecture, on Wednesday, February 18, in Mangaluru. | Photo Credit: H.S. MANJUNATH

The banking system is a major engine for economic growth, and India must ensure that the system runs at full speed. There might be issues, regulatory, policy or taxation; banks should come together to resolve them, he said.

Mr. Panda said the financial requirements of various economies — developing, advanced or emerging — are different and urged banks to have patient balance sheets while funding emerging sectors, transport, green energy, etc., that demand long-term capital.

For manufacturing growth, especially in the sunrise sectors, banks need to evaluate the technologies, understand the supply chains and understand the strength of their export competitiveness. Innovation financing represents another frontier for banks, he said and regretted the transition from venture-funded innovation to bank-funded innovation for the maturing start-up ecosystem, which, he added, still remains a delicate bridge.