The 2008 financial crisis led to the renewed realization that close linkages between financial firms can also cause large-scale disruption when financial firms fail. This paper provides a brief description of the principles of cross-border resolution that have emerged since 2008 and an overview of developments on resolution of financial firms in India.
It finds that while there is cognizance of the need for international cooperation on resolution, the focus is on first developing institutional capacity on domestic resolution that can interact with the international community in the future. The policy choices of India may be reflective of the thinking in a large number of emerging markets, which lag considerably behind more developed markets.
