(a) whether SEBI, market regulator, has played
a dubious role in checking the spurt and
melt down of shares of new economy
companies in 2000, till date;
(b) whether the Government are seriously
considering to stop this menace forever to
protect small investors who are tempted
to rising prices; and
(c) if so, the details thereof?
MINISTER OF STATE IN THE MINISTRY OF FINANCE (BALASAHEB VIKHE PATIL)
(a): Price fluctuations on stock markets
is a market phenomena and depend on several
factors which include domestic and international
events, economic fundamentals, market sentiments,
expectations of investors regarding the
performance of the corporate sector and
the economy in general, about economic
policies of the Government, developments in
international capital markets etc.
The globalisation of commerce has
created correlation in market
movements world wide. The recent fall
in the US markets, particularly the
shares of new economy companies, has
influenced other markets in the world
and globally, the markets have been
on a downtrend.
(b) and (c): The objective of the Government
and the regulator is to ensure that
capital markets operate in an orderly,
transparent, safe and fair manner.
To ensure this and to protect interests
of investors, SEBI has put in place
several surveillance and risk containment
measures such as capital adequacy, margining
systems, exposure controls and price
bands. The surveillance measures implemented
include the stock watch system
which is expected to enhance
surveillance capabilities. The risk
containment measures include upfront
margins in the form of base and additional
capital, and imposition and collection
of mark to market margin, volatility
margin and carry forward margin.