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May 25, 2001
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Money > Business Headlines > Report May 25, 2001 |
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USAID revives India markets reform planBS Banking Bureau The US Agency for International Development's Financial Institution Reform and Expansion project, which was forced to pull out of the country after the Pokhran nuclear test in May 1998, is back with a new agenda to reform the Indian equity and debt markets. Officials from the FIRE project II will be meeting Association of Mutual Funds of India officials on Friday and Securities and Exchange Board of India brass next week. The earlier FIRE project (project I) was designed to support the government's efforts to raise the efficiency and transparency of its capital markets to international standards. The project I was terminated on August 14, 1998, following the post-Pokhran US sanctions. The project has been revived on account of the importance attributed to the strong capital markets for improving global trade and investment. On the agenda for the FIRE project II are five key fields. The first covers the legal and regulatory issues for the stock exchanges in terms of trading, setting up a national market system and bringing together the stock exchanges. The project will look closely into the financial accountability. It will have a major role to play in the building up of the debt markets, as well as introducing and strengthening the derivatives market, as the country prepares for trading in futures and options. The official team from the USAID, agency for international development, will be interacting with the Institute of Chartered Accountants of India to work on strengthening disclosure norms. Amfi will play a vital role in enhancing investor awareness. The domestic markets have since 1994 acquired greater depth partly on account of FIRE's technical expertise. Officials from USAID will work with the regulators -- Sebi, the stock exchanges, the Reserve Bank of India, Amfi, and the ICAI -- to improve the equity and debt markets further. The role of the FIRE project is to provide necessary technical assistance and training to key domestic institutions. Since the initiation taken by the USAID, capital market institutions in the country have adopted the US model. FIRE helped create awareness about "best practices" in the US market and initiated direct links between Indian institutions and US capital markets institutions. Powered by YOU MAY ALSO WANT TO READ:
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