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Addressing the members of the Tamilnadu Investors Association (TIA) during its Silver Jubilee function, he said that volatility is one of the major issue in the stock market and bringing in government bonds for distribution to the people would help attract more investors considering it is risk free.
"We have taken up the issue with the Sebi and RBI seeking its consent. Once it happens we can also do auctions by which investor can buy Government bonds in primary, as well as secondary market is always."
He said that a new capital market can be developed through this and while currently only two% of India is investing in stock market with this, it could be taken up to 20%. It would also be required, since the country needs to create more jobs and most of it has to come from the private sector, which in turn require huge funds to grow. Currently most of the savings the country is doing is not into the banks, markets or insurance companies, but into real estate or gold, which are not productive.
"We need to give the comfort to investors and that is what BSE is endeavor too. BSE had legacy issue. While matter of pride is BSE has the largest number of listed companies, it is also matter of shame to use BSE and stock exchanges for tax evasion and other activities. We don't want BSE to be allowed or used for any tax evasion or manipulating."
The stock market system has doubled to a market capitalisation of Rs 101 lakh crore, despite the fact the Government has given huge protection, benefits and importance to the banking system and stock markets have become larger in terms of the wealth represent.
However, the country has not seen an increase in the number of investors, in proportion to the growth.
"The number of investors in 1993 and in 2015 are almost similar. Indian GDP has grown up multifold, the middle class grew by 10 times, but we have not added investors," he said. This is because we have not be able to gain confidence amongst the people about investing in the market, he said.
Channelising the capital is the main purpose of the Stock Exchanges, while one relates Stock Exchange primarily to trading. The BSE is focusing on investment products, to contribute to the overall growth, he added.
The BSE is going to de-list 1000 companies going forward, which many investors have commented as anti- investor activity. The Exchange is keeping the penny stocks alive for the existing investors, but they are junk and it cannot allow these stocks to affect the new investors, he added.
