Brushing aside criticism by stock exchanges, former RBI Governor and chairman of a Sebi committee Bimal Jalan today defended his report saying that bourses cannot be allowed to get listed on a market that is still volatile.
"We have expressed our views based on balance of opinions. The listing will have some implication which has to be taken into account. This is not the time for listing because the market is extremely skewed. You can review the recommendations after five years," Jalan told reporters on the sidelines of a CII event.
Responding to criticism of his report on market intermediaries, Jalan said, "I do not accept that it would hamper competition in the market place."
"Stock exchange is performing the service business. It has to safeguard the interest of public and other stakeholders," he said.
Market regulator the Securities and Exchange Board of India (Sebi), he added, could take a final view on the issue of listing by stock exchanges.
The Jalan committee report, which was placed on Sebi website to elicit public views, had opposed listing of stock exchanges on bourses arguing that any downward movement of their share prices could hit the credibility of the market institutions.
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The report of the Sebi-appointed committee evoked sharp reaction from experts and market participants.
The report, if implemented, could derail the plans of the country's two premier bourses -- the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE)-- to go public.
The report of the committee, whose members included prominent banker Uday Kotak and industrial conglomerate Tata group's senior executive Kishore Chauker, could be taken up for consideration in the next meeting of the Sebi board.
Pointing out that the market infrastructure institutions (MIIs) were public institutions, the report had said, "any downward movement in its share prices may lead to a loss of credibity and this may be detrimental to the market as a whole... Therefore, the Committee is not in favour of permitting listing of MIIs."
The stake holders have been asked to send their comments on the recommendations of the report to the Sebi by December 31.