SME Times News Bureau | 24 Oct, 2020
Securities and Exchange Board of India Chairman Ajay Tyagi believes
that development of bond markets is necessary to help the Government to achieve
its target of investment in Infrastructure.
“It would be a challenging task to achieve the Government’s target of achieving
Rs 100 lakh crore investment in Infrastructure by 2024-25 unless the bond
market is adequately developed,” said Ajay Tyagi while addressing the Inaugural
session at the 11th edition of the CII Financial Markets Summit which is
being organized on 21-22 October.
While elaborating on the theme of one of CII’s flagship events this year, the
Chairman said that it is a misconception to think that reforms could take place
only when there was a problem with the existing system or that reform only
means radical changes by Government or the Regulators.
Reforms, he added, was not just limited to fixing a broken
structure but also includes incremental changes. He further iterated that
SEBI’s approach towards reforms has been progressive, open-minded and forward
The SEBI Chief further mentioned that the recovery in capital markets after the
initial hit by the pandemic has been broad-based.
“We have observed that recovery has been broad-based. It is not only the large
cap, but the mid and small cap shares have also recovered since the low hit in
March 2020,” Tyagi said.
The corporate bond market needs to become more robust because there is an
urgent need to diversify funding requirements from the banking sector, the
The Chairman also addressed the increase in independent directors’ resignations
in the last two years and urged them to come forward and flag concerns if
related to corporate governance.
Speaking about the role of other stakeholders in reforms, the capital markets
regulator said that all stakeholders need to play equally important role
towards the reformation of the financial markets.
“While I talked about the reforms brought in by SEBI, it backs the question as
to why the term ‘reform’ is almost always been associated with the Government
or the regulators. We believe that other stakeholders need to play equally
important role in reforming the financial markets,” the SEBI Chairman said.
The SEBI Chair also acknowledged that illiquidity in the
bond markets was an issue and that it needed long-term solutions.
Addressing the Inaugural session at the CII Financial Markets Summit was also Uday
Kotak, President, CII who began by complimenting SEBI on taking “unprecedented
decisions in record time to ease the pain of COVID and giving much needed
regulatory relief to all segments of the capital market.”
Kotak further added “reforms in the securities market need to focus on
fundamentally encouraging delivery-based customers, who buy on cash basis.”
“SEBI has taken many steps to support the broking industry and improve the
quality of the broking industry. Simplification of account opening through
e-KYC is a true game-changer for broking, depository participants and mutual
funds businesses,” the CII President added.
On the LODR guidelines for listed companies, Mr Kotak asked SEBI to look at how
it can ease areas for promoters’ reclassification. He also suggested SEBI to
review Open Interest limits, particularly for large institutional investors,
which were put in place in March.
Earlier in the Summit, Chandrajit Banerjee, Director General, CII delivered the
welcome address and thanked SEBI and the industry for their continued support
towards CII. He added that it was necessary to get the country back on its
growth trajectory and to re-shape businesses through adequate financing options.