The Ministry of Finance plays a very crucial role in development planning in India. It supervise the financial institution and is responsible for the overall financial management of the country. The Industrial Development Bank of India (IDBI) which in the initial years was a subsidiary of the Reserve Bank of India (RBI) was separated from it in July 1975 and since then has been operating as an apex financial institution engaged in financing the industrial sector, in accordance with national priorities. The Reserve Bank of India which was created in April 1935, with a share capital of Rs. 5 crore and nationalised in 1949 is the central arch of the Indian money market. It issues currency, buys and sells Government securities, regulates the volume, direction and cost, credit, manages foreign exchange and supports institutions financing agriculture and industries. According to the preamble to the Reserve Bank of India Act, 1934 the main function of the bank is “to regulate the issue of bank notes and the keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage”. The Industrial Financial Corporation of India (IFCI) which was established in 1948 accounted for over 8 percent of the total financial assistance to the industrial sector in 1994. The State Bank of India (SBI), set up in 1955. The objective of this major reform of the Indian banking system was that the State Bank with its large network of branches should provide directly and indirectly through provision of remittance facilities to cooperative and commercial banks and to increase banking facilities in the rural areas.  The financial institutions have had a long history of public ownership with existing insurance companies being nationalized in 1956 to form the Life Insurance Corporation of India (LIC).