The Hindu Business Line : SEBI moots measures for integration of capital markets in SAARC region

"It is not only the beaming blessings but definite and determined decisions that will fructify the dream. National priorities naturally take precedence over regional resolutions. Fortunately, the current environment and understandings are relaying very positive signals," Mr Bajpai said.

Mr Y.H. Malegam (left), Chairman, National Advisory Committee on Accounting Standards, with Mr G.N. Bajpai, SEBI Chairman, at the South Asian Federation of Accountants' conference in the Capital on Saturday. - Kamal Narang

New Delhi , Aug. 28

THE Securities and Exchange Board of India Chairman, Mr G.N. Bajpai, on Saturday, proposed a slew of measures including harmonisation of listing agreements that can be acted upon immediately to achieve integration of the capital markets in the SAARC (South Asian Association for Regional Co-operation) region.

Addressing the South Asian Federation of Accountants (SAFA) conference on `Integrated Financial Sector in the SAARC region' here, Mr Bajpai said the SAARC countries might take some time to achieve the essential requirements for achieving comprehensive integration. He suggested that preparatory work can be undertaken on issues such as harmonisation of listing agreements, establishment of inter-market trading system and real-time inter-depository connectivity till the essential requirements are achieved.

The essential requirements identified by the capital market regulator include free flow of capital without any restrictions both in current and capital accounts, facility of full-convertibility to the investors of the SAARC countries and development of regional credit rating standards to instil confidence among the investing community.

The SEBI Chairman also underscored the importance of political will to achieve integration of capital markets.

The other issues identified by Mr Bajpai include inter-market trading system, information dissemination, clearing, settlement and development of regional market index.

Over the possibility of having only one large stock exchange in the country, Mr Bajpai said that in a market-led economy it would not be fair for the regulator to push for merger of stock exchanges.

On how independent the independent directors in the corporate boards are, Mr Bajpai said the listing agreement defined the attributes of independent directors. He said the growing trend of corporate governance ratings has also enabled the assessment of the independence of the independent directors. "Eventually, the market will determine the independence of independent directors and not the management," said Mr Bajpai.

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SEBI moots measures for integration of capital markets in SAARC region