MUMBAI: India’s financial system will need to evolve to finance the country’s next phase of economic expansion, with banks playing a larger role in supporting higher-value manufacturing, new technologies, the green transition and enterprises seeking to compete globally, SBI chairman C S Setty said at the SBI Banking and Economics Conclave in Mumbai on Wednesday.“The banking and financial system will need to evolve alongside it, providing the financial architecture that enables innovation, investment, and strength,” Setty said, referring to India’s transition towards becoming a leading economic force.Setty said India’s resilience through successive global and domestic headwinds had strengthened the financial system’s ability to participate in the next stage of economic expansion. But sustaining that momentum would require improvements in productivity and competitiveness, deeper integration with global value chains and the emergence of enterprises capable of competing at scale in international markets.“The question is not simply how fast we grow, but how effectively we convert growth into global informativeness and leadership,” he said.Setty pointed to India’s large and dynamic domestic market, young workforce, improving infrastructure, domestic capital and globally competitive services sector as strengths that could support the next phase of growth. Digital public infrastructure, he said, had demonstrated how technology, scale and public purpose could come together to create solutions with relevance beyond India.The next wave of global investment is likely to be shaped by sunrise sectors such as renewables, semiconductors, energy storage and green hydrogen, as well as robotics, biotechnology and frontier technologies, Setty said. India has the talent, entrepreneurial energy and technological capabilities to participate meaningfully in these sectors, he said.“The larger opportunity lies in translating these trends into businesses, technologies, manufacturing capabilities, and intellectual property that can command a global footprint,” Setty said.This transition will require the financial sector to support innovation and investment as the economy moves towards higher-value manufacturing and globally competitive enterprises. The banking sector, he said, would have a significant role in enhancing infrastructure, enterprise and innovation as part of the broader transformation of the productive economy.
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The conclave brings together policymakers, regulators, industry leaders and economists to examine how India can sustain its economic momentum, deepen confidence and create conditions for the next generation of Indian enterprises and institutions to build a global presence. Setty said the discussions should result not just in fresh perspectives but in ideas that could contribute to the country’s next phase of development.
