The committee, which met on Monday, also decided to call for a meeting of the major custodians and depository participants in the near future in order to address issues related to infrastructure.

``It was however felt that such a measure will have implications in terms of liquidity, carry forward mechanism, availability of alternative hedging mechanism in the form of derivatives,'' said the chairman of the committee, MR Mayya. ``We need to ensure liquidity in the system and hence the committee felt that this issue needs to be studied separately,'' he added.Representatives of exchanges - Bombay, Calcutta and National Stock Exchange and custodians like BoI Shareholding, Stock Holding Corporation of India andCanara Bank participated in the discussions held on Monday.

The committee noted that shares of 64 companies were now being traded compulsorily in the dematerialised form and by May 31, 1999, the number will increase to 104 to include the most actively traded shares. In the light of these discussions, it is learnt that the committee discussed the implementation of one common settlement cycle for the smaller exchanges and one for the larger exchanges vis-a-vis the introduction of rolling settlement for the shares which are being traded in the demat form.

Interestingly, the committee also recognised that the introduction of uniform settlement cycle in other stock exchanges has implications in terms of availability of infrastructure, particularly with respect to the custodians and the depository participants. Hence the committee decided to call for a special purpose meeting with major custodians and depository participants in order to take care of these issues. According to committee members, the uniformsettlement framework which is already operative in respect of the Inter Connected stock exchange, was also noted during the discussions.