The recommendations in the report of the Bimal Jalan Committee (the “Committee”) (discussed in a previous post) has generated a lot of buzz. These recommendations have mostly been met with criticism, the most criticised being the stand taken by the Committee to disallow the listing of the stock exchange. A column in a newspaper (available here) reports the sharp exchanges between the stakeholders and the Committee members over the recommendation to disallow the listing of stock exchanges in a meeting organised by CII.
Further, in an open letter published in newspapers (see Economic Times and Financial Express- 21st December 2010) by a minority stakeholder in NSE to the NSE's managment, the view expressed is that- “Without listing, minority shareholders feel trapped". To the contrary, the MD of NSE seems to be supportive of the Committee’s recommendations, as is evident from this news report available here. He is reported as stating that “Some people have argued that this conflict is not serious or that a poorly governed exchange will collapse. If the conflict is not serious, how is it that every developed market has taken out the regulatory role from an exchange.” This is apparently demonstrating a rift between the minority shareholders and the management of NSE, reflecting the wider debate and lobbying over the Committee’s recommendations. This is portrayed in another news column available here.
The most interesting remark to the Committee’s recommendation has been that- “Jalan panel disrespects Parliament”, which is in a news column available here, wherein the author brings out the contradictions between the Committee’s recommendation and the previous report of committee headed by former Chief Justice of India M.H. Kania, pursuant to which major amendments were brought to the Securities Contract (Regulation) Act, 1956. The author therein remarks that “The Jalan Committee takes us back not just in time but to the soviet philosophy of 1970s” [emphasis mine].
Further, in an open letter published in newspapers (see Economic Times and Financial Express- 21st December 2010) by a minority stakeholder in NSE to the NSE's managment, the view expressed is that- “Without listing, minority shareholders feel trapped". To the contrary, the MD of NSE seems to be supportive of the Committee’s recommendations, as is evident from this news report available here. He is reported as stating that “Some people have argued that this conflict is not serious or that a poorly governed exchange will collapse. If the conflict is not serious, how is it that every developed market has taken out the regulatory role from an exchange.” This is apparently demonstrating a rift between the minority shareholders and the management of NSE, reflecting the wider debate and lobbying over the Committee’s recommendations. This is portrayed in another news column available here.
The most interesting remark to the Committee’s recommendation has been that- “Jalan panel disrespects Parliament”, which is in a news column available here, wherein the author brings out the contradictions between the Committee’s recommendation and the previous report of committee headed by former Chief Justice of India M.H. Kania, pursuant to which major amendments were brought to the Securities Contract (Regulation) Act, 1956. The author therein remarks that “The Jalan Committee takes us back not just in time but to the soviet philosophy of 1970s” [emphasis mine].
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