Capital market: move to improve investor confidence

Measures proposed for the capital market in the budget by the finance minister is aimed at boosting investor confidence and strengthening market integrity. The measures announced were:

The process of demutualisation and corporatisation of stock exchanges are expected to be completed during the course of the year.

Sebi Act 1992 for investor protection will be amended to enhance the effectiveness of Sebi as the capital market regulator.

Accounting standards and effectiveness of auditors are proposed to be strengthened by regulation.

Foreign institutional investors (FIIs) can invest in a company under the portfolio investment route beyond 24 per cent of the paid-up capital of the company with the approval of the general body of the shareholders by a special resolution. FII portfolio investments will not be subject to the sectoral limits for foreign direct investment except in specified sectors.