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January 29, 2007 17:54 IST
Citigroup Inc, the largest US bank, has asked India to liberalise its financial services sector, saying it would help the country maintain and improve over eight per cent GDP growth.
Citigroup Chief Executive Officer Charles Prince, during a meeting with Minister of State for Commerce and Industry Ashwani Kumar at the recently concluded World Economic Forum meeting at Davos, said opening up the sector would give a boost to the Indian economy.
"The restrictive policies could choke the growth," Prince was quoted as saying by officials.
Foreign banks, including Citigroup, have been clamouring for opening more branches and sales outlets. However, Reserve Bank has followed a conservative policy in granting them licences.
Some of the foreign banks in India had been trying through the non-banking financial services routes for implementing their expansion plans. But the apex bank has been quite strict about the norms.
Prince said he was upbeat on the Indian economy, which has the potential of maintaining and improving its present level of growth.
Meanwhile, reports suggest that Citigroup is taking several steps, including reducing the payroll to increase profit and reduce expenses by over $1 billion.
Shareholders, including Saudi Prince Alwaleed bin Talal, the largest individual investor, have been mounting pressure on Citigroup to cut spending that rose 15 per cent last year.
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