Finance Minister Arun Jaitley interacted with the members of the SEBI Board and senior officials of SEBI in New Delhi today. Arjun Ram Meghwal, Minister of State for Finance, Shaktikanta Das, Secretary, Ministry of Finance, Arvind Subramanian, Chief Economic Advisor, and Ajay Tyagi, Additional Secretary, Ministry of Finance, also attended the meeting.
U.K. Sinha, Chairman, SEBI apprised the Finance Minister on the key recent developments and trends in the Indian securities market during the last few years and also the current and future agenda of SEBI as well as related issues affecting SEBI.
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It was acknowledged during the discussion that the share of market based finance vis-à-vis bank finance had impressively gone up, particularly during 2015-16 and 2016-17 (till Jan, 2017). There has been tremendous rise in resource mobilization by the mutual fund industry during the last few years.
It was noted that the asset under management (AUM) of the mutual fund industry had substantially gone up almost 2.5 times from Rs. 7.01 lakh crore as on March 31, 2013 to Rs. 17.37 lakh crore as on January 31, 2017.
Similarly net flows to mutual funds have been rising continuously every year since 2013-14 and during 2016-17 (till Jan. 31, 2017), the industry had received net flows of Rs. 3.68 lakh crore, witnessing a massive rise of almost 2.75 times over the net flow figure of Rs. 1.34 lakh crore during 2015-16. The FM appreciated the huge growth and the emergence of mutual funds as an important savings vehicle.
During the interaction, reforms and regulations steered by SEBI in the areas of ease of doing business, governance, corporate bond market, exit of regional exchanges, HFT / Algo trading were also appreciated. Need for further development of commodity markets in both the spot and derivatives segments and the recent Union Budget proposal to look into integrating the two segments were also highlighted during the discussion.
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The Finance Minister remarked that the Indian securities market has witnessed very significant developments during last 5 – 6 years, particularly in the context of technology heavily influencing the market operations accompanied with increase in the size of markets. He also noted that regulations have been evolving fast during this period. He complimented SEBI and particularly observed that SEBI as an institution has established a lot of credibility for itself. He also mentioned about the recent Union Budget announcements relating to the securities market which would form as a part of the future agenda for SEBI.