Dear Comrades,
“On
this occasion of Cross Regional International Conference, I welcome
participants from various countries, officials of World Saving Bank
Institute and other officials from Government.
It
is matter of pleasure that the Cross Regional International Conference
is being organized in India. As a nation our significant population is
young and youth will continue to represent a large proportion of our
citizenry in near future. Considering such demographic profile of India,
the subject matter and deliberations of the Conference with focus on ‘Increasing the Financial outreach in youth’ will be of significant value to us.
I
note with satisfaction that the conference is well represented by
eminent experts in this field and people having vast experience in
running saving programme in their region. Your inputs and shared
experiences will provide further momentum to savings movement.
India
as a society is driven by the ethos of savings for our future
generations and acquiring knowledge. There is a verse in one of our
classical and one of the oldest languages Sanskrit;
क्षणश: कणशश्चैव विद्यामर्थं च साधयेत ।
क्षणे नष्टे कुतो विद्या, कणे नष्टे कुतो धनम ।।
क्षणे नष्टे कुतो विद्या, कणे नष्टे कुतो धनम ।।
The
verse implies that knowledge and wealth can only be acquired gradually
by investing time and sustained savings, respectively. If one does not
invest time, knowledge cannot be acquired and unless one saves, wealth
cannot be built. Not surprising, it is common place in India to set
aside a sum as first charge from the income for saving for future
generations and educating them.
With
such rich tradition, India has always been a partner in the
international effort to promote savings. Since 1924, when India was one
of the signatory to the International Savings Congress, we have been
unsparing in our efforts to inculcate the habit of thrift and savings
have often helped us in tiding over difficult economic situation.
While promoting savings it has to be realized that Government acts as
the custodian of the pooled savings of some very under privileged
sections. It is the responsibility of the Government to ensure that such
household savings are completely secure, earn a good return to the
investor and the money is available to the investor at the time of his
or her requirements . Further this pooled wealth is channelized for the
purpose of creating durable assets in the country.
To
address these challenges, the first regulatory framework in India dates
back nearly 130 years with the enactment of Government Savings Bank
Act. In the post colonial period, Constitution enjoined upon the State
moral responsibility to bring in economic equality and provide avenues
for economic prosperity to all its citizens. Savings is one vehicle to
usher in economic prosperity.
Responding
to the responsibility placed by the constitution Government expanded
the legal framework for small savings instrument to meet the enhanced
requirement. To mobilize savings through Savings certificates,
Government enacted a Savings Certificate Act in 1959 and to provide a
social safety net to those working in the un- organized sector a Public
Provident Fund Act was brought in 1968.
All
the instruments and schemes to channelize small savings were made fully
secure by the Government and carry the implicit guarantee of the
Government. These instruments provide easy access and have features to
provide liquidity to the saver. There are significant tax incentives
extended by the Government to those making investments.
Contribution
of domestic savings in National Development has been remarkable. India
is ‘one’ among the counties having a high rate of domestic saving, which
is at present to the tune of 30% of its GDP. The domestic financial
savings rate which had declined during last few years has again shown
recovery and with propagation of the programmes to encourage people to
save more, we expected to attain a higher savings rate. The Government
as a policy is committed to revitalize and strengthen the network which
promoted savings among the masses.
India
has taken various measures to encourage savings in the recent past.
“Jan Dhan Yojana” of financially including those who are left unbanked
is a major step in this direction. Further, Government has significantly
expanded the bouquet of small savings scheme. A special scheme for the
Girl Child will be shortly announced by the Government to address the
gender imbalance. Similarly, a scheme with insurance cover to the under
privileged is being worked out. Similarly schemes are being reintroduced
and expanded to increase the flow of savings towards productive
purposes. Recently, we have increased the tax incentive on investment
made from small savings by 50%.
Children
and young people are the future economic actors whose financial
decisions, as prospective family heads, employees and community
contributors, will impact, ultimately, on the stability of world
economies. They need to be prepared to take on this role and
responsibility. In order to be effective they need to start dealing with
financial matters as early and young as possible. This needs support
from both their family and their schools. Thus it is up to all of us to
enable the systematic and structural platforms for extending
opportunities to the young people. It also involves the creation of
social and cultural environment and legal and regulatory framework to
facilitate the financial engagement of children and youth.
India has one of the highest ratios of young people who are below the age group of 35 years. It is expected that nearly 2/3rd our
population will ne young in coming decades. Similar situation is faced
by other developing nations as well. This is the greatest strength of
the India economy of today. The relationship between youth and formal
financial service providers needs strengthening. This can be done by
traditional means as well as with the use of technological means at
various levels since today’s youth is more familiar with technology. The
same can attract them towards the financial products. I am sure, this
WSBI Cross Regional Conference will address the issues of meeting this
challenge and working out strategy to motivate the young to open and use
their accounts.
India
is committed to revitalize the small savings for the benefit of small
savers and sustaining economic development. The cooperation between
Government agencies like National Saving Institute, Department of Posts
and Banks with the International organizations like World savings Banks
Institution, is a welcome step in this direction and I expect that this
Conference will be helpful in formulation of new strategies based on
the experiences of the esteemed delegates who have come all the way to
India and in turn, they will also get enriched by the experiences of
India in mobilization of resources and promotion of savings.
Financial
inclusion is one of the most potent weapons to fight against poverty. I
would thus like to emphasize that such cooperation should not end with
this conference but must continue so that strategies for financially
including those who are not a part of process are constantly built and
recalibrated . Further, the massive challenge of financial engaging the
youth is adequately met. With these words, I wish the conference all
the success.”
