SEBI pledges assistance to build strong derivatives
The Securities and Exchange Board of India (SEBI) has assured all
technical assistance to the Colombo Stock Exchange (CSE) to build a
strong derivatives market in Sri Lanka, said SEBI Whole Time Member M.S.
“We will provide support to the Sri Lankan regulator, the Securities
and Exchange Commission (SEC) and the CSE to develop a strong capital
market through new instruments like derivatives,” Sahoo told the Daily
This was revealed when a high-powered delegation from the SEC and CSE
visited the SEBI on a study tour for a collaborative effort to launch
derivatives to the Sri Lankan market.
He said the securities/stocks listed in India exceed more than US$
one trillion and the number of sales traded in volume is the highest in
the world. The reason being that 70 per cent of the market is dominated
by several derivatives, which is a role model for many stock markets in
Sahoo said India is reckoned as one the most established markets in
the world for exchange traded derivative products and to further deepen
the derivatives market and to cater to the growing needs of investors
for sophisticated products.
He said India has a strong capital market with the introduction of
new instruments to the market. This is a non-transparent trading
mechanism with a National Clearing Corporation.
Sahoo also said that India has not been much impacted from the global
financial crisis due to a strong industrial and service sector based
with a domestic presence. Therefore, Sri Lanka should also do likewise
to promote a strong capital market, he said.
India has not been impacted with the global financial crisis, as the
country’s capital account was not fully convertible. India has a huge
domestic market with strong agriculture, industrial and service sectors
foundation, he said. He said the National Stock Exchange (NSE) which
brought transparency, transformation and state-of-the-art technology to
the Indian markets, brought trading in derivatives by introducing Nifty
futures (NSE derivatives trading index). Therefore, Sri Lanka should
also introduce indices in the event of introducing derivatives for