Merger will lead to many synergies: Ramesh Abhishek

Interview with former chief of the FMC

Ramesh Abhishek, former chief of the Foward Markets Commission (FMC), shares his views on merger with the Securties and Exchange Board of India (Sebi).

On synergies behind Sebi-FMC merger

There might not be any immediate synergies. Going ahead, there could be common intermediaries for the two markets. There could be fungibility of funds, common clearing corporations. Investors will be able to trade in all segments of the market. This will lead to economies of scale for the participants. Cost of trading will come down in due course. There will be better monitoring of risks. Trading volumes might also improve due to fungibility. This is now possible with a common regulator.

On aggrieved FMC employees

The Finance Act provides the staff here can become central government employees or can get absorbed in Sebi. The Centre has decided to make them employees and a notification has been issued. The next provision is if Sebi asks for services of some of the staff, the government may provide the same. Sebi has asked for the services of 15 and the government has provided for the services to Sebi. They will be relieved on Monday and will join Sebi on Tuesday. Those not going to Sebi will get adjusted in the government. I won't comment any further, as the matter is sub judice.

On expanding the scope of commodity futures

On the one hand, we need depth in the market, so we need more products and participants. On the other, you have to examine carefully what the impact is going to be. Options have not been tried here. I am sure Sebi will take a decision on this after considering all such aspects.