Emerging markets, which have enjoyed significant foreign portfolio investments, are now facing certain key challenges such as market integrity, risk management and corporate governance, suggest the luminaries who participated in a three-day International Conference 2005, at Mumbai, recently, organized jointly by IU and Sebi.
It would be a rare sight when one can see a market regulator, galaxies of academicians, practitioners, researchers, and market participants sharing the same platform. One can also imagine how fruitful this interaction could be and so the outcome. It is no daydreaming. This was made possible when IU and the Securities and Exchange Board of India (SEBI) joined hands together to organize a three-day International Conference 2005 on the theme, "Emerging Securities Market-Challenges and Prospects," held at Taj Lands End, Mumbai from January 10 to January 12, 2005.
G N Bajpai, Chairman, SEBI, inaugurated the conference. Delivering his inaugural speech, the SEBI chief spoke about several milestones achieved by the country's capital market owing to the measures initiated by the market regulator in recent times. Notable among these measures are the introduction of rolling settlement, the shift to the T+2 settlement cycle from T+5, derivatives trading and improved surveillance mechanisms among others. Thanks to these measures, he said, the trading mechanisms on the country's stock exchanges are much more robust today to handle any amount of transactions. These efforts have surely boosted investors' confidence including FIIs, who have shown increased interest in the Indian capital market.
However, this does not mean that everything is hunky dory as Bajpai also cautioned about certain significant challenges facing the emerging capital markets including India. A key issue facing the emerging markets is that of liquidity (or lack of it). He said that liquidity is an issue in every market and not just in India. However, this is not to say that things have not changed. In fact, contrary to the widely held belief, liquidity has improved a lot as far as the Indian market is concerned.
