New Delhi: India’s financial markets do not need a super regulator but require better coordination between the existing watchdogs, said C. Rangarajan, chairman of the Prime Minister’s economic advisory council.

“At this particular time, it may be advisable to continue with the existing system, rationalize the overlap if there are any, and try to improve the coordination among different regulators," the former Reserve Bank of India governor said on Sunday. “We still have not reached a stage in which our various financial segments have developed to a full extent."

“The experience that is now available does not point to a very clear evidence as to which is better," Rangarajan said.

“The UK had a single regulator and it ran into problems. The US had multiple regulators and they also ran into problems."

The financial sector legislative reforms commission, led by retired judge B.N. Srikrishna has in a draft report suggested establishing a single regulator for financial markets.

“The draft report talks in terms of single regulator for all financial other than banking,’ Rangarajan said. “This again is not very consistent."

The commission in an approach paper had proposed a unified regulator for financial sector laws, including those for the capital markets, insurance, commodities and pensions. It, however, had proposed to keep banking out of the proposed super regulator’s purview and suggested setting up of a financial redressal agency to address consumer complaints against financial companies.

The approach paper, on which the commission will seek comments from stakeholders, had underlined the need for establishing an independent debt management office and a financial sector appellate tribunal to hear appeals against regulators.

“These changes will alter the financial landscape from eight financial regulatory agencies to seven," the paper had said. This is expected to form the basis of a report of the commission set up in March 2011 to rewrite laws affecting the financial markets in the country. PTI