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Mr M. Damodaran, who was appointed Chairman of the Securities and Exchange Board of India, with the outgoing SEBI Chairman, Mr G. N. Bajpai, who retired on Friday. - Paul Noronha

Mumbai , Feb. 18

MR Meleveetil Damodaran took charge on Friday as the Chairman of the Securities and Exchange Board of India.

The 57-year-old bureaucrat, who resigned as the Chairman and Managing Director of IDBI to take up the new post, has been appointed for a three-year term at SEBI. Mr Damodaran replaced Mr G.N. Bajpai, who completed his term on Friday.

Setting the tone for his tenure as the head of the capital market regulator, Mr Damodaran said punishments for mischief-makers in the market would be "swift and heavy."

"We will proactively quell mischief makers. The key is in anticipating it and creating an environment where they are aware of the repercussions of their activity. We will create circumstances to minimise market mischief," he added.

In an impromptu press meet, marked by many compliments being mutually showered by the exiting and the new chairmen, Mr Damodaran said Mr Bajpai has raised the bar of achievements for the chairman of SEBI, and that even if he is unable to raise it further he hopes to maintain it at the current level. Mr Damodaran, who rose to fame after he turned around the beleaguered UTI, responding to a query on whether the markets were on fire, said there are two kinds of fires: one that burns you and the other that warms you up. What is being felt now is the second kind, he said.

Mr Bajpai said that in his three-year term, the Indian securities market has gone through significant achievements and has been acknowledged both domestically and internationally. He said he leaves the office with no regrets and is looking forward to his retirement. Mr Damodaran's reputation as a "no-nonsense" manager has preceded him, and the markets view his appointment as a move that will help protect the interests of the small investors. He is viewed as a regulator who will take some tough stances.

Employees of SEBI are also concerned about the changes that will be effected in the organisation by the new Chairman. Some UTI officials say they have been flooded by calls from their acquaintances in SEBI seeking opinions on Mr Damodaran and his style of work.

Mr Damodaran resigned as the Chairman of IDBI on Friday. He had earlier stepped down from his roles as Chairman of Specified Undertaking of Unit Trust of India and UTI Mutual Fund. Speculations suggest that Ms Ranjana Kumar, Chairperson, Nabard, is likely to be appointed to the top spot at IDBI.

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