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Bajpai is looking at the big picture

BS Markets Bureau

Securities and Exchange Board of India chairman G N Bajpai is planning a fundamental shift in the approach of the capital markets watchdog.

Instead of shadowing all players all the time, it will now lay down rules and ensure they are followed without exception.

Self-regulatory organisations are also expected to play a major role in the new regime. In effect, Sebi under Bajpai plans to shift its focus from micro management to macro regulation.

"Why should I get into the nitty-gritty (of market operations)? That process has to be undertaken by the operators themselves and self-regulatory organisations.

"I am very clear in my mind that I will lay down the rules and see that they are followed without exception," Bajpai told Business Standard.

He is also in favour of setting up new committees to help Sebi play the regulator's role well.

"Sebi has the benefit of a number of committees. There are eminent people (in these committees). We will continue to interact with them. I want to set up more and more committees."

He also said the Sebi would review the recommendations of the existing committees before it acts on them. "I strongly believe that whatever was put up at a particular point of time needs a review. I don't believe in status quo ante," Bajpai said.

A man not in a hurry, Bajpai is still in the process of understanding his new role. He has already met representatives of the stock exchanges and brokers. He will meet heads of companies next week.

"I will meet everybody - investors, entrepreneurs, intermediaries, mutual funds, merchant bankers, FIIs. My view is that a regulator must be respected. And for a regulator to be respected, it is necessary that the regulator is able to understand its role clearly," he pointed out.

What has been the outcome of these meetings? "Well, they all feel that investor confidence needs to be revived. It is the main issue and once we address this, everything else falls into place. I give myself two weeks to finalise the agenda. Investors have to be invited back to the market," he said.

Bajpai said he had not been given any mandate by the government. Three weeks after taking over the new assignment, he has not yet had "any meaningful interaction with anybody in the government" because he is glued to this office trying to "understand the nuts and bolts of markets".

He refused to pass a value judgement on whether powerful corporates come in the way of Sebi's smooth functioning or whether the capital market watchdog has enough powers to take on corporates.

"Empowerment is event-specific. I don't know yet whether Sebi has enough powers. I would like the organisation to be dynamic and it must be able to respond to the environment with full preparedness," Bajpai said.

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