Recent trends in the Indian capital market in English

Contents

Explain the recent trends in the Indian capital market.

Recent Trends in Capital Market

Many improvements and reform over the last some years have been made in the field of capital market. It has increased the transparency, integrity and efficiency of the operation of trading. Stock exchanges have increased quality of price discovery and decreased cost of transactions. NSE’s and BSE’s trading terminals provide services at each part of the country. Computer based transaction system and depositories have reduced risks. Some recent changes of capital markets are as under :

1. Various Amendments in Securities Exchange Board of India Act, 1992: SEBI Act has been amended by making following changes:

Empowering SEBI with powers of search and seizures,
Impose penalty on the violator.

2. Solution of UTI’s Problems: The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 was passed by repealing Unit Trust of India Act, 1963, so that one-time solution of problem can be searched out.

3. Encourage to Retail Trading in Government Securities : Retail trading is encouraging in gilt-edged securities. Due to it all class of investors can contribute in it.

4. Training Arrangement: The Securities and Exchange Board of India has make arrangement to provide training to take part in security market and to encourage research.

5. Development of Debts Market: Indian Clearance Corporation has started functioning for the clearance and settlement of transactions.

6. Takeover Regulation : SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 makes provisions for disinvestments of public sector undertakings, additional disclosure requirements etc. Securities and Exchange Board of India announced an amnest scheme.

7.Self-Regulatory Organisation : Now, all market intermediaries can become member of one or more self regulatory organisation.

8. Other Recent Trends: In addition to above following are some other trends of capital market:

Commencement of trading in stock index futures, stock index options and stock options,
Beginning of electronic data and information filling and retrieval system (Its object is to making electronic filing by the listed companies),
Beginning of on-line inter-depository transfer,
Demutualisation of stock exchanges,
Beginning of rolling settlement for all scrips on all stock markets,
Issuance of SEBI (Sweat Equity) Regulation, 2002,
Compulsory Bench marking of debt-oriented and balance fund.