Deepak Parekh, chairman, Housing Development Finance Corporation (HDFC) has backed the Securities and Exchange Board of India (Sebi) to regulate participatory notes (PNs) of foreign institutional investors in a structured way.
The recent measures to curb capital inflows and seeking transparency in transactions through PNs, which has caused the Sensex to fall steeply, would not have any long-term damaging impact on the markets, he said.
However, Parekh, who was speaking on the sidelines of a conference ?Vision for Indian Insurance Industry? that was organised by Indian Merchant Chambers on Friday here, said unregulated inflow of excessive capital are causing problems for the country?s economy as rising rupee is hurting the IT and BPO sectors which so long have been spinning employment opportunities. ?With the rupee appreciating to 11%, margins of BPO, that were operating at 15% profit margins have fallen dramatically due to the massive capital inflows the country has been witnessing,? he said.