Standardise stamp duty all across
The
development of the grossly underdeveloped debt market in India has been years in the making. Despite various promises, the corporate bond market in India hasn’t developed as it should have been. A comparison with other economies shows that the total amount of corporate bonds outstanding in India is just 0.4% of GDP. But now, with SEBI considering loosening of disclosure norms and RBI allowing short-selling in G-Secs, there is a definite hope. That is, as long as the government doesn’t play truant!
There are quite a few reasons for that. While India continues to grow at a brisk pace, the demand for credit in the economy is escalating. But if one looks at the current infrastructure, it very flagrantly manifests that the banking system–the major provider of credit – will not be able to satisfy the credit demand in the future. Not only this, banks will have their own cup of woes once Basel II norms are implemented. Though equity markets look right now like quasi-El Dorados, they can pull the rug under anyone’s feet at any moment. Given a scenario like this, improving the accessibility of the corporate sector to debt, through a structured and transparent corporate bond market, becomes imperative.
For Complete IIPM Article, Click on IIPM Article
The
development of the grossly underdeveloped debt market in India has been years in the making. Despite various promises, the corporate bond market in India hasn’t developed as it should have been. A comparison with other economies shows that the total amount of corporate bonds outstanding in India is just 0.4% of GDP. But now, with SEBI considering loosening of disclosure norms and RBI allowing short-selling in G-Secs, there is a definite hope. That is, as long as the government doesn’t play truant!There are quite a few reasons for that. While India continues to grow at a brisk pace, the demand for credit in the economy is escalating. But if one looks at the current infrastructure, it very flagrantly manifests that the banking system–the major provider of credit – will not be able to satisfy the credit demand in the future. Not only this, banks will have their own cup of woes once Basel II norms are implemented. Though equity markets look right now like quasi-El Dorados, they can pull the rug under anyone’s feet at any moment. Given a scenario like this, improving the accessibility of the corporate sector to debt, through a structured and transparent corporate bond market, becomes imperative.
For Complete IIPM Article, Click on IIPM Article
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