The Hindu Business Line : Need to win investors' confidence: Joshi

FOR the healthy growth of the capital market, there is a need to cultivate and win over the confidence of the investors. To ensure this, there is need for a greater transparency in dealing with the investors, Mr Manohar Joshi, Lok Sabha Speaker, while inaugurating the Web site `investorfriend.com'.

The site is promoted by the Kanpur-based Midas Touch Investors Association and designed and developed by the Lucknow-based UPTEC Computer Consultancy Co, said.

Speaking at the occasion Mr Shivraj Patil, former Speaker, Lok Sabha, and Deputy Leader Opposition (Lok Sabha), said that present economic policies are meant to encourage the private sector to enter the areas, which till now it did not have a presence in. He said the most important constituents of the liberal phase of economic policy making are the consumers and the investors. The latter have to be protected from fly-by-night players in the market.

Where the Government machinery fails, the entry of NGOs like the Midas Touch Investors Association is welcome. Mr M.M. Sardana, Secretary, Department of Company Affairs (DCA), while cautioning the investors said that they should think twice and examine all the aspects before investing. The Secretary further said that the company laws inception is not of recent origin and the amendments of 2000 have been done to protect the investor's interests.

Besides, the law has been amended whenever the need arose, he said. There have been so many changes that these do not get percolated to the investors with the result that they know none of the changes in the laws.

The Web site, has provision of Parliamentary questions of investor interest, interactive sections, database of 4,900 defaulting companies and a facility for complaints for redressal.

According to Mr Shivraj Patil, Deputy Leader of the Opposition (Lok Sabha), it is the task of the Government machinery to rectify the grievances of the investors. In fact, SEBI has been created precisely for this purpose, he said.

"I have had a talk with SEBI on why they are not able to rectify the wrong which has been done to the investors. SEBI officials feel that they do not have enough powers" he told Business Line.

Advocating for more powers to be granted to SEBI, Mr Patil said, "investors interest should be considered first." Agreeing that vetting of a company's prospectus before the public issue is one of the many tasks performed by the market regulator, Mr Patil pointed out that it is of not much help. In fact, it is the pre-issue advertisements that lure the investors, and this is where SEBI has no powers to monitor.

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Need to win investors' confidence: Joshi