Karvy ban shows India must get rid of dodgy brokers to back healthy equity

India is hardly immune to the global trend of sliding fees and trading commissions.

Any attempt at sweeping out a corner of India’s financial system means bringing investors face to face with creepy-crawlies. Disagreeable as the task is, it’s also necessary.

More than $200 billion in bad loans tumbled out when banks were made to open their attics to the regulatory broom four years ago. That cleanup isn’t over, and already it’s the stockbrokers’ turn. Who knows what will emerge?

Investors are waiting to find out after the Securities and Exchange Board of India, or Sebi, banned Karvy Stock Broking Ltd., a middleman for nearly 250,000 clients, from taking on new customers. The regulator