India opening up to foreign banks

The country’s central bank has unveiled new rules that will allow foreign banks to expand their presence by opening branches anywhere in India. In order to do so the subsidiaries will be required to hold minimum capital of five billion rupees ($80 million).

The changes are a part of the push by the central bank's new governor, Raghuram Rajan, to liberalise the sector as he looks to boost growth.

Foreign banks have long wanted to boost their presence in the country, which is home to nearly 1.2 billion people. However to date they have had to face tight regulations, particualrly over the number of branches they can open.

The Reserve Bank of India said the new rules would allow them to open branches "at par with Indian banks".