RBI pitches for market access

The Reserve Bank of India wants other central banks to reciprocate its policy of going beyond the WTO commitments in allowing foreign banks to open branches in India.

Compared with overseas regulators, the RBI has been quite liberal even though foreign banks operating in India keep on complaining about restrictions. In its discussions with foreign banks, the RBI is understood to have indicated that the process cannot be a one-way street.

If the overseas regulators pay heed to the RBI's request, the State Bank of India would be a major beneficiary. The bank has lined up major expansion plans in the US for which it has already received the RBI's permission.

In various meetings with regulators in the US and European countries, the RBI had complained of lack of specific business models for Indian banks operating in their countries.

The RBI, in turn, has asked state-owned banks to submit their business plans before applying for permission to expand in Europe and the Americas.

According to banking sources, SBI plans to expand its operations in the US after a gap of about four-five years. SBI's operations there suffered a blow after the Securities Exchange Commission issued strictures against the bank's clearing operations in 1999-2000.

SBI wants to revamp its existing branches and representative offices in Chicago, New York, California and Washington. It plans to open two new branches by turning one representative office into a branch. The other branch will be a new one.

Sources said that if permitted, the bank would try to tap the increased business opportunities offered by the Asian community in the US.

Besides, a lot of Indian companies have been investing abroad.