According to sources, the Mehta visit would mainly be in terms of exchanging notes with other regulators in the region and would not consist of any particular exchange of ideas or initiatives between the markets regulators of India and Pakistan. "It is a meeting of Asia-Pacific regulators, and would not be anything specific to Pakistan. Pakistan is basically playing host," the sources explained. The meeting of Iosco's chapter would mainly dwell on the norms regulators have devised in the markets across the region and experiences of the regulators.

Besides, discussions would also centre around whether the basic principles of Iosco are being followed in these countries as far as regulatory mechanisms are concerned, the sources pointed out. In fact, regulatory officials in India are working hard to play down the Pakistan angle, even as a section of the stock market has come up with the idea of a common regional mutual fund which would invest in India, Pakistan, Sri Lanka and Bangladesh.

Regulatory officials told The Financial Express that they had no idea what the fund was about, since no firm proposal had come to them. Unit Trust of India (UTI) officials, however, said there was a broad proposal to devise some kind of a regional fund which would invest in these four countries, but no clear idea had emerged just yet. "There can be several models which it can work on", UTI officials said.

One of the models could be, for instance, that the fund raises money from investors in India, Pakistan, Bangladesh and Sri Lanka, and then invests the quantum raised from each country back into those countries. However, the issue of how the returns would be denominated would have to be decided as well. The issue of a fund has been thrown up following a visit by Indian stock exchange officials to Pakistan and the exchange officials are now keen that such a fund takes shape.