Scribd
Upload
115 views2 pages

Reforms in Capital Market

The document summarizes reforms in the Indian capital market, including the establishment of development financial institutions to provide long-term funding, legislative measures like the Companies Act of 1956, reforms to the government securities market like establishing the Securities Trading Corporation of India in 1994, the establishment of SEBI as the regulatory body for the securities market in 1988, registration requirements for market intermediaries, establishment of credit rating agencies, and setting up the Investors Education and Protection Fund to protect small investors.

Uploaded by

Apurv Surya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
115 views2 pages

Reforms in Capital Market

The document summarizes reforms in the Indian capital market, including the establishment of development financial institutions to provide long-term funding, legislative measures like the Companies Act of 1956, reforms to the government securities market like establishing the Securities Trading Corporation of India in 1994, the establishment of SEBI as the regulatory body for the securities market in 1988, registration requirements for market intermediaries, establishment of credit rating agencies, and setting up the Investors Education and Protection Fund to protect small investors.

Uploaded by

Apurv Surya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

Reforms in Indian Capital Market

1. Establishment of development financial institutions:


For providing long-term funds to industry, Government of India
established many financial institutions i.e., IFCI (1948), ICICI (1955),
IDBI(1964), IRCI(1971), UTI(1964) etc. Moreover 14 major
commercial banks were nationalised in 1969 and another6 banks were
nationalised in 1980.

2. Legislative Measures :
The government passed the Companies Act in 1956. This Act gave
considerable power to the government to centre and direct the corporate
enterprise in India. Similarly the Capital Issue (Control) Act was passed
in 1974 to regulate investment in different enterprise.

3. Reforms in Government Securities Market


• Establishment of Securities Trading Corporation of India (STCI) in 1994 to
develop institutional structure for government security market.
• The delivery versus Payment System was introduced in 1995 for the
settlement of transactions in government in government securities.
• The negotiated dealing system (NDS) was operationalised in Feb 2002 to
enable online electronic bidding facility in state/central government security
market.

4. Establishment of SEBI
SEBI (Security Exchange Board of India) was established on April 22,
1988 as a non-statutory body by the government of India to look after
the issue of development of central market. But, due to increasing
business activities of capital market and various scandals of 1992 in
exchange market SEBI came into force as a statutory body on Jan 30th,
1992.

5. Registration of intermediaries
As per the provision of SEBI Act 1992, registration of intermediaries
such as stock brokers and sub brokers and sub-broker started. The
registration is on the basis of certain eligibility such as capital
adequacy, infrastructure etc.

6. Credit Rating Agencies


Three credit rating agencies i.e., Credit Rating Information Service of
India Limited (CRISIL)(1988), Investment Information and Credit
Rating Agency of India Limited (ICRA) (1991) and Credit Analysis and
Research Limited (CARL) were setup in order to assess the financial
health of different financial institutions and agencies related to stock
market activities.

7. Investors Protection
Under the purview of SEBI the central government of India has setup
the Investors Education and Protection Fund (IEPE) in 2001. It works
in educating and guiding investors and to protect the interest of the
small investors from frauds and also malpractices in the capital market.

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy