In sixth year, six things to do for U K Sinha

U K Sinha will begin his sixth year as the head of India’s securities market regulator on Thursday. Sinha, who took charge as the chairman of the Securities and Exchange Board of India (Sebi) in February 2011, has touched on every aspect of the securities market. Here are six things he could look at in coming months:

Listing of stock exchanges: Although Sebi has cleared the decks for listing of stock exchanges, certain key issues still need to be tackled. Sinha has to consider allowing self-listing or changing the disclosure framework.

Reforms in commodities markets: The integration of commodities market has been fairly smooth. However, some reforms have taken a backseat due to issues on trading in agricultural commodities. Sinha’s priority will be to bring risk management and surveillance for commodities trading on a par with stock trading. Also, he has to move on allowing new participants such as banks, mutual funds, and foreign investors.

Tackling high-profile cases: Sebi has received a fair share of success and setbacks in handling of high-profile cases. The orders passed or decisions taken by Sebi on Reliance Industries’ insider-trading case or the DLF ban failed to break much ice with Securities Appellate Tribunal.  

Infusing life in new trading platforms, instruments: Sebi under Sinha’s stewardship has introduced new fund-raising instruments such as real estate investment trusts, infrastructure investment trusts, green bonds, municipal bonds, and platforms for listing start-ups. But, most have been non-starters.  

Refund in Sahara, PACL, IPO & other disgorgements: The regulator has passed refund orders in the matter of Sahara and PACL, which run into thousands of crores of rupees. Sebi has a huge task overseeing these refunds. Also, after acquiring new powers, Sebi has passed several disgorgement orders. However, the process of implementing disgorgement orders and ensuring the amount reaches the affected needs to be improved.

Further relaxation in FPI framework: New foreign portfolio investors (FPI) rules, which have eased the entry of foreign investors, have been hailed. But players have sought further relaxation, such as doing away with paperwork for entities regulated by foreign securities market regulators.

U K SINHA OVER FIVE YEARS

• Framework to enable lenders convert debt into equity in defaulting companies
   
• Framework of trading and capital-raising in municipal bonds, green bonds, and convertible securities
   
• Guidelines for setting shop in Gift City SEZ
   
• Allowing more companies to do rights issue, FPOs on fast-track route
   
• Framework for re-classification of promoters as public shareholders
  

 

Changing OFS framework to allow more retail participation
 

Doubling anchor investor quota in IPOs
 

Policy on commodity derivatives exchanges following merger with FMC
 

Removing irritants to enable listing of stock exchanges
 

Tightening of investment norms for debt MFs
 

Providing exit opportunity for dissenting shareholders in IPOs