'Technology will be the driving force,' he says, 'and I expect to see the establishment of a large number of financial intermediaries'. He said that a shortage of trained personnel remained the country's Achilles heel.

Mr Meetarbhan says that the insurance sector, which counts thirty firms with assets of 42 billion rupees (21.2% of GNP) needs to deal with a number of challenges:

• marketing methods need to change to recognize the country's new taxation system;
• product distribution techniques need to change to accommodate technical advances;
• the banking sector needs to move into offering insurance products;
• further regulatory change is necessary to allow for financial conglomerates and cross-border firms.

Milan Meetarbhan said that the stock exchange had experienced a good year, particularly because of the listing of global funds, of which there were now 500 with assets of US$50bn.

The FSC chief announced the entry into force of a new Securities Act, dealing with collective investment schemes, and a new Insurance Act before May, 2007. He also talked about the diffculties with India over the countries' Double Tax Avoidance Treaty, insisting that the bulk of Global Business Companies did not depend on the DTAA. However, he said that 60% of transactions in the Global Business sector were with India, and that no action should be taken which could harm the interests of that sector.