Decks cleared for Sebi member's appointment

Cabinet committee approval for Agarwal, Sridhar’s clearance may follow.

Decks have been cleared for the appointment of senior Revenue Department official Rajeev Agarwal as a whole-time member of the Securities and Exchange Board of India (Sebi).

A senior finance ministry official told Business Standard that the Appointment Committee of Cabinet (ACC) had cleared Agarwal’s appointment and the orders would be notified soon.

He added that Agarwal, a 1983-batch Indian Revenue Services (IRS) officer, would have to resign from the Revenue Department to join Sebi as a whole-time member.

“It was decided that no candidate would be allowed to take up a Sebi member’s job on deputation basis. Some candidates were not considered during interviews because they did not want to resign from their services,” said the official.

He pointed out that the process of Agarwal’s resignation from the Revenue Department and his joining Sebi was expected to take about a month’s time.

A sub-committee headed by Sebi Chairman U K Sinha had recommended Agarwal’s and former Central Bank of India chairman S Sridhar’s names to fill the vacancies created on the regulator’s board after the retirement of M S Sahoo and K M Abraham in July.

Subsequently, the two names had been sent to ACC for its final approval. The finance ministry official added that the Central Vigilance Commission was yet to give clearance to Sridhar.

The CVC go-ahead in Sridhar’s case is critical because he was at the helm of affairs at Central Bank of India, the official banker for the Commonwealth Games held in the capital last year. The bank and Sridhar had been named in the V K Shunglu Committee report over alleged irregularities in the Games.

The official said there were some differences between CVC and the finance ministry on the issue but the matter was expected to be resolved soon. He added that both Agarwal and Sridhar had been selected to be whole-time members of Sebi because of their wide experience in handling regulatory matters.

Before moving to Central Bank, Sridhar was the chairman and managing director of National Housing Bank — the regulator and refinance agency for mortgage players.

Agarwal has served as a member of the Forward Markets Commission (FMC) — the regulator for the commodity futures business. He spent five-and-a-half years at FMC, where his main job was to set the ground rules for new exchanges and create awareness about commodity futures. He also has the experience of tax-related cases pertaining to capital market investigations.

With Sinha as chairman and existing board member Prashant Saran, who has been there for a while now, the appointments of Agarwal and Sridhar will complete the formation of a new-look Sebi team.