Govt reviews RBI’s proposal on opening foreign bank branches, Indian banks’ global expansion

M. Nagaraju, Secretary of the Department of Financial Services (DFS), led a meeting of the inter-departmental committee (IDC) on Thursday to evaluate proposals from the Reserve Bank of India (RBI) regarding the setup of foreign bank branches, representative offices, and subsidiaries within India.

The committee additionally reviewed requests from Indian banks aiming to establish overseas operations through comparable mechanisms. Discussions also covered applications from foreign banks seeking to relocate their current branches within the country. Following deliberations, the IDC endorsed the presented proposals.

The meeting included representatives from the Ministry of Home Affairs (MHA), Ministry of External Affairs (MEA), Department of Commerce (DoC), and the RBI.

As the nodal agency for evaluating such proposals, the DFS oversees the IDC’s operations for both domestic and international banking institutions.

According to a Finance Ministry statement, “The committee engages in consultations with member ministries, including MHA, MEA, and DoC, to ensure decisions reflect a collaborative consensus before finalizing recommendations.”

Nagaraju highlighted India’s strides in financial inclusivity and digital modernization during his address at the CII Financing Summit 2025, noting these as transformative achievements over the past decade.

“Financial inclusion and digital advancements stand among India’s most significant accomplishments, fundamentally reshaping the financial ecosystem and reinforcing institutional credibility,” he stated.

He referenced notable progress in India’s Financial Inclusion Index, which climbed to 67.0 in March 2025 from 64.2 a year prior, signaling broader access to formal financial services.

The Pradhan Mantri Jan Dhan Yojana (PMJDY) also saw substantial growth, with accounts increasing from 52 crore to 57 crore in the past eighteen months.

(With inputs from IANS)