Former NSEL promoter Jignesh Shah shifts gear, bets on water conservation

Gearing up for his second innings, embattled entrepreneur Jignesh Shah feels there is a great opportunity in setting up digital ecosystems for helping social sector enterprises raise funds and for products aimed at promoting water conservation.

"There is an urgent need to further these causes, but my idea is to do them in such a manner that it is commercially viable for all stakeholders rather than making them look like charity work or something that has been forcefully imposed. Given the conducive political environment in place today, I want to help create these ecosystems as a mentor," Shah said.

The comments assume significance in the wake of water conservation being one of the top priorities for the Modi government, while it has also proposed an idea of setting up 'social stock exchanges' to help social sector organisations raise funds.

The 52-year-old businessman, who began his entrepreneurial journey in his 20s and went on to set up 14 exchanges across six continents in a span of 10 years, had to exit all exchange-related businesses under regulatory orders in the aftermath of a Rs 5,600-crore default at one of his smallest ventures, National Spot Exchange Ltd (NSEL), in 2013.

In an exclusive interview with PTI, Shah said the time has come to start his second innings as court orders are absolving him of all the charges one after another as no agency could prove even a single paisa of wrongdoing on his part, nor on the part of his companies.

While one of his flagship exchanges, MCX (Multi-Commodity Exchange), had become the world's second-largest commodity bourse under his leadership and all other group exchanges were also doing well before his exit, Shah said he does not want to bask in his past glory and the time is no longer right for a business model focussed on exchanges.

"I am rather thinking about ecosystems as they make much more sense in today's digitally-connected borderless world and I see myself creating and innovating products and businesses for the masses as a coach and as a mentor," he said.

In her Budget speech in July, Finance Minister Nirmala Sitharaman had said it was time to take capital markets closer to the masses and meet various social welfare objectives related to inclusive growth and financial inclusion.

She proposed to initiate steps towards creating an electronic fund raising platform - a social stock exchange -- for listing social enterprises and voluntary organisations working on social welfare objectives so that they can raise capital as equity, debt or as units like a mutual fund.

Asked whether he can set up such an exchange, Shah said the Modi government has created an enabling environment for new ventures, which was not the case during the earlier regimes, and still he went on to successfully set up 14 exchanges including in places like Singapore.

He said he had once discussed the idea of a social exchange nearly 10 years ago with Bangladeshi social entrepreneur and Nobel laureate Mohammad Yunus, and had also prepared a blueprint.

"However, the time for exchanges has gone and it is now the time for ecosystems. In this new digital era, what it requires is an enabling environment, full transparency, a rule-based regime and a digital highway.

"We will need a right mix of products to attract people wanting to invest in social sector without making it look like a charity. We need that kind of ecosystem. I will improve on my last plan and it will be a commercially-viable proposition. This definitely will be on the cards," he said.

Asked about water conservation, which is another focus area of the government, and whether he can look at some financial marketplace products in this area, Shah said something similar was done during his first innings for carbon credits and it was followed up with an electricity exchange that no one had thought could be viable at that time.

"After California, we were the first to do a carbon credit exchange. We proved how a carbon credit exchange can be commercially viable so that people are not forced to purchase carbon credit or do it as a CSR (Corporate Social Responsibility), but do it with commercial interest," Shah said.

"We followed up that blueprint with an electricity exchange. Unfortunately, we had to exit from that exchange and it remains in the same state as it was in 2013. We could have made it into an exchange for the entire SAARC region," he said.

"With regard to water also, an innovative plan can be put in place to make it an attractive proposition, which will serve a cause and yet be commercially viable with a right product mix.

"But again, I would say the time for exchanges has gone and in today's digital borderless world we need to create a water ecosystem that needs to be an attractive value proposition while encouraging people to preserve it," Shah said.

"It should neither be projected just as a social cause, nor forced like a CSR activity. It should rather be a wise commercial decision like provident fund," he said.

Shah said he is very keen on getting such ecosystems executed by roping in "right young minds", while himself playing the role of "a catalyst and an enabler".

On Independence Day last month, Prime Minister Narendra Modi had devoted a good part of his speech on the issue of water conservation and had said a campaign for this cause should not just remain a government initiative but should become a people's movement.