Raghu ram Rajan`s plans boost Indian SENSEX and banks.

After central bank Governor Raghu ram Rajan defined plans to boost the financial industry and alleviate the rupee, SENSEX in India rushed the most in Asian markets and a great rally in lenders..

The largest lender by market value, HDFC bank surged 8.1 per cent and stepped the biggest rally in the S&P BSE India Bankex index in four years…Larsen and Toubro Ltd climbed the most in more than two months

. Bharat Heavy Electricals Ltd. revived the most since May 2009. The ADR Index of the Bank of New York Mellon India surged 3 per cent to a three-week high of 951.57 at 1:40 p.m. in New York.

New RBI Governor Rajan’s announcement of new plans yesterday increased the S&P BSE Sensex 2.2 per cent to 18,979.76.His plans include measures to make it easy for banks to open branches and lend to non-state sectors of the economy.

According to JPMorgan Chase & Co. analysts these measures will have a “major long-term impact” on bank profits. The RBI will also provide swops for banks’ foreign-currency deposits that Bank of America Merrill Lynch estimates will lift India’s reserves by $10 billion.

Sunil Singhania, head of equities at Reliance Capital Asset Management Ltd. said that it’s all about restoring confidence and that new RBI Gov. Rajan has definitely done. He said that Rajan has sent a clear signal that the RBI will do everything to face the challenges. The market is reflecting that confidence.

The former International Monetary Fund chief economist, Rajan, is struggling with a currency that has plunged 17 per cent this year and consumer-prices increases of almost 10 per cent though India`s economy grew weakly by 4.4 per cent in the quarter ended June. The rupee got stronger by 1.5 per cent over 66.1150 per dollar.