The Finance Ministry on Tuesday asked stock exchanges to provide “consolidated inputs” for improving the depth and liquidity of stock markets. They were also asked to give suggestions for expediting the setting up of SME platforms so that resource mobilisation by SMEs can be facilitated.
The move to ask stock exchanges to provide their inputs in writing came at a meeting convened by the Finance Ministry here today. All the leading bourses, certain broker associations and representatives of select regional stock exchanges were represented at the meeting.
Finance Ministry officials described the meeting as a “follow-up” to the one held on August 11. At the meeting, representatives of stock exchanges are understood to have given various suggestions to improve liquidity including extending the trading hours for currency derivative segments, allowing foreign institutional investors (FIIs) to participate in the currency derivatives segment and also encouraging SMEs to list on regional stock exchanges.
The issue of enabling foreign pension funds to invest in the domestic stock markets in a big way was also discussed.
However, there was no consensus among the stock exchanges on some of these suggestions including the one on permitting FIIs in the currency derivatives segment, sources said. It may, therefore, be difficult for them to provide “consolidated inputs” on the same, it was pointed out.
Finance Ministry officials also wanted the stock exchanges to enhance financial literacy in a concerted manner.
The meeting was chaired by Dr Thomas Mathew, Joint Secretary (Capital Markets), in the Finance Ministry. Among those who attended include Ms Chitra Ramakrishna, Deputy Managing Director, National Stock Exchange, Mr Joseph Massey, Managing Director & CEO, MCX Stock Exchange, Mr V.K.Sabharwal, Vice-Chairman, Federation of Indian Stock Exchanges and Dr Naresh Maheshwari, President, Association of National Exchanges Members of India.