The pace of financial sector reforms so far and the roadmap ahead will come up for discussion on Saturday under the aegis of Financial Stability and Development Council (FSDC).

The FSDC meeting in Mumbai assumes significance as it would be the first after the new Narendra Modi-led Government came to power at the Centre, with Finance Minister Arun Jaitley chairing it. The meeting will discuss regulatory and economic issues with all the financial sector regulators.

The financial markets will closely watch the outcome of this meeting as the approach of the new Government to financial innovation is still not clear.

It is yet to be seen whether Jaitley will encourage financial innovation at the marketplace, enable consolidation in the banking system and prepare the financial system to meet the foreign investors’ expectations.

This will be the 11th FSDC meeting. The first one was held in December 2010.

It will be attended by RBI Governor Raghuram Rajan, SEBI Chairman UK Sinha, IRDA Chairman TS Vijayan, Forward Markets Commission Chairman Ramesh Abhishek and Pension Fund Regulatory and Development Authority officiating Chairman RV Verma.

The FSDC may also discuss issues such as regulatory coordination, foreign capital flows, implementation aspects of financial sector legislative reforms commission (FSLRC) report.

Indications are that the meeting will discuss the financial sector reforms that could be taken up in the upcoming Budget.

There is also speculation that the Government may in the coming weeks go ahead with the merger of Forward Markets Commission (FMC) with SEBI. A Finance Ministry note on this issue is almost ready and Jaitley would have to take a final call on the matter, sources close to the development said.