The Secretary, Department of Financial Services (DFS), Shri M Nagaraju, chaired a meeting of the Inter-Departmental Committee (IDC) on January 2, 2026, to review proposals from foreign banks seeking to establish a presence in India. The meeting reflects the Government of India’s structured and consultative approach towards regulating foreign banking operations in the country.
High-Level Participation from Key Ministries and RBI
The IDC meeting was attended by representatives from key ministries and institutions, including:
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Ministry of Home Affairs (MHA)
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Ministry of External Affairs (MEA)
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Department of Commerce (DoC)
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Reserve Bank of India (RBI)
The proposals under consideration had been forwarded by the RBI and pertained to foreign banks desirous of opening branches, representative offices, or subsidiaries in India.
Deliberations and Recommendations
During the meeting, the Committee held detailed deliberations on the proposals placed before it. After due examination and inter-ministerial consultation, the IDC recommended the proposals for further processing, in line with the applicable regulatory and policy framework.
The discussions focused on ensuring that the entry of foreign banks aligns with India’s financial stability, regulatory norms, and national interest.
Role of the Inter-Departmental Committee
The Inter-Departmental Committee (IDC) functions under the Department of Financial Services, which acts as the nodal department for evaluating proposals from both foreign and domestic banks. Before arriving at a consensus, the Committee undertakes consultations with concerned ministries and regulators to ensure a comprehensive assessment of each proposal.
This mechanism ensures transparency, coordination, and due diligence in decisions related to banking sector expansion.
Strengthening India’s Banking Ecosystem: DFS
The consideration of foreign banks’ proposals highlights India’s continued efforts to maintain a balanced and well-regulated banking ecosystem. Such evaluations are crucial for promoting competition, enhancing access to global financial expertise, and supporting India’s broader economic and financial integration, while safeguarding regulatory and security interests.
Conclusion
The IDC meeting chaired by the Secretary, DFS underscores the government’s collaborative and institutional approach towards overseeing foreign banks’ entry into India. Through inter-ministerial coordination and regulatory scrutiny, the process aims to strengthen India’s banking sector while ensuring financial stability and alignment with national priorities.
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Source: PIB
