An efficient financial system is one of the foundations for building sustained economic growth and an open, contestable economic system. In its best efforts, finance works quietly at the background, but when things go wrong, financial failures are painfully visible. For an economy to attain sustainable growth in the long run, financial sector development is crucial and indispensable. The financial sector traditionally comprises banks, non-bank financial institutions, and insurance. But now with financial sector liberalization, foreign direct investment, stock markets, remittances and microfinance institutions have emerged. These segments link up with the real sector to deliver growth. The linkage is established through savings mobilization from surplus units to deficient units. Financial globalization and integration have brought in financial deepening and strengthening of the financial structure. It affects the growth rate of any economy directly through domestic savings, availability of cheap capital, technology transfer, and development of the domestic financial sector. The book tries to examine the Interlinkage between the financial sector and the real sector of the economy, which is very relevant in the light of financial liberalization. It gives some country perspectives, both in the context of developed economies like UK, USA, Europe and Japan and developing economies, like Hong Kong, Singapore, India and China as well as emerging economies like Latin American countries.
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