Date:05/01/2005 URL: http://www.thehindubusinessline.com/2005/01/05/stories/2005010501920400.htm

Back Overseas terminals for Indian stock exchanges mooted

Vimala Vasan

Abu Dhabi , Jan. 4

GREATER NRI participation in the Indian stock market could be facilitated by permitting stock market terminals to be set up overseas and modernising the IPO market infrastructure, a senior official of Geojit Financial Services Ltd has said.

"Solutions have to be worked out to enable functioning of stock exchange terminals abroad, particularly in the Gulf countries and other places where there is a large NRI population," Mr C.J. George, Managing Director of Geojit Financial Services Ltd and a Director in the UAE-based Barjeel Geojit Securities told Business Line while on recent visit to the UAE.

The absence of such terminals is preventing NRIs from participating actively in the Indian stock market, Mr George pointed out.

"The market is losing out big money because of this. There is a need to establish joint ventures in the Gulf to enable such terminals to function as regulatory requirements do not permit them to function independently. We have represented the matter to the SEBI and quick action needs to be taken," Mr George said.

He also referred to the need to modernise the 25-year-old infrastructure in the Indian IPO market and make it more tech savvy to enable smooth and quick investment in IPOs.

"NRIs in particular are affected by the time lag in receiving and forwarding applications and are often unable to meet IPO deadlines. The NRI Investors Forum has made representations on the need to improve conditions to help enable NRIs to participate more in the IPO market," he said.

There was a perceptible growth in NRI investments in MFs last year and interest in the primary market is also growing, he said. Referring to the phenomenal growth indices in recent months in the Indian stock markets, Mr George said that the growth would be "unstoppable".

The possibility of a market friendly Budget was also providing reasons for great optimism regarding the market's bull run, he added.

He pointed out that 100 new FIIs had registered in India in 2004, taking the total to 650, and turning India into a major investment destination. Many of these investors had long-term interests, he said, adding that the strong fundamentals of the economy and investor friendly decisions will help sustain the upward growth in the coming period.