Regulations must for alternate investment schemes: Finance minister to Sebi

The unregulated private pool of capital poses a systemic risk and appropriate regulations need to be framed soon for alternative investment funds, Finance Minster Pranab Mukherjee told the market regulator Securities and Exchange Board of India (Sebi) on Saturday.

The finance minister, who addressed the Sebi board on Saturoday in New Delhi, said that financial costs have to be brought down for retail investors and new mutual fund distribution channels have to be formed to enhance penetration.

According to the finance minister, investors' appetite for market-linked insurance, credit and investment products in on the rise. Mukherjee said he has tried to provide an impetus for growth in capital market by lowering transaction costs and incentivising retail participation.

The finance minister is optimistic that the measures outlined in this year's budget will revive private investment and put the economy back on the higher growth path.

The Indian economy is expected to grow by 7.6 per cent in 2012-13, he said.

The board meeting was attended by the Sebi board members and executive directors along with

R Gopalan, secretary, ministry of finance and Kaushik Basu, chief economic adviser, ministry of finance.