For instance, a recent press release from Sebi reads that the president and executive director of BSE, managing director of NSE, executive director of CSE and other members of the secondary market advisory committee agreed with recommendations of the L C Gupta committee on derivatives trading and they had suggested that Sebi should take steps for the introduction of derivatives trading. Who are going to benefit from the introduction of financial derivatives trading? The concept itself is based on forward cover.

By facilitating a market for the derivatives, the policy makers are creating a broad platform for the speculators. Ifspeculation is going to occupy the centerstage of Indian financial markets, how will this country mobilise the resources to build up industries?

Indian investor per se is not, too, greedy. This is amply reflected in the deposit amounts mobilised by various banks despite low interest rates. A genuine investor would prefer the security and liquidity of his investments over fabulous returns.

What he requires is a conducive climate where he can get in and get out freely. However, have the policy makers, lost as they are in their romantic involvement with the over-leveraged financial markets of the West, ever made a honest attempt to address this problem?

In the early nineties, Sebi issued merchant banking `license' to every Tom, Dick and Harry worth Rs 3 crore -- later the networth requirement was raised to Rs 5 crore -- under the guise of spreading equity cult. Most of these johnnies helped many a fly-by-night operator to enter the primary market and loot the investing public. Many of these companiestoday don't have even a postal address, let alone a market quote!

At a time when the equity route was completely blocked, and genuine investors are saddled with surplus funds, large corporations and institutions, mostly government-controlled ones, are allowed to make merry in the bond markets with attractive coupon rates. Most of them offered the investors `easy liquidity' through market making. Thus, between fiscal 1996 and 1998, nine government-controlled institutions and six public companies floated bond issues worth Rs 9240 crore and collected over Rs 12000 crore.

An estimated investor family of over 40 lakh people have voluntarily contributed to the development of Indian industries as well as infrastructure facilities through these bond issues. However, what is the exit route available for them in an emergency? Today, not even one out of the 22 bond issues during the fiscal 1996, 1997 and 1998 is regularly traded on a recognised stock exchange. All the promises of `market making' have become more ofa joke after the bond-floats.

Had these bonds been made actively traded, more and more bond issues would have attracted the investors looking for a better interest rate than the bank deposits. Indeed, it is an irony that the market regulator is prepared to push more scrips into the demat segment just to keep NSDL in business even when it shows no inclination to compel the bond-offerors into market-making which will only benefit the investing public at large?

Why can't the policy makers think about such needs of the common investors and do something to develop the debt market in a big way, instead of paving the way for alien and little understood derivatives which can ultimately spoil the investment culture and climate, especially the equity cult, in this country?

It is high time, the policy makers thought in a broader perspective of building a nation rather than creating a den for some speculative brokers whose only aim is to amass wealth for themselves at any cost.

Preempt the sanctions and beintegrated with your own investing community first because they never desert at the first sound of an implosion!