Capital markets watchdog Sebi on Thursday underscored the need for having a unified trading platform for deepening the corporate debt market and said it is working with all stakeholders, including the Reserve Bank, to usher in such a facility.
Just like the Government securities has the Clearing Corporation of India (CCIl) platform where reporting and settlement of a transaction takes place, the corporate bond market also requires a unified platform, Sebi Chairman U K Sinha said at a seminar here. “If you want the corporate bond market to develop, we need to have such a platform,” he said addressing bond market participants.
“We are working with the RBI and others, who are concerned with this, on how we can make a unified debt market in this country,” he said here at an event organised by ratings agency Crisil. The Sebi chief said today we have a over-the-counter platform, one of the exchanges and the third one of the market participants Fimmda where the trading happens.
Underlining the need for integration, Sinha cited the case of commercial papers and certificate of deposits, saying the settlements happens in one particular stock exchange, while the reporting happens somewhere else. The Sebi had issued its guidelines for a unified debt platform recently and NSE has positively reacted to it by launching its own platform on November 11, he said.
Addressing the seminar, Economic Affairs Secretary Arvind Mayaram called for deepening the corporate bond market, which according to Crisil stood at Rs 18.3 trillion in 2012. Mayaram said in terms of GDP and the size, the Indian corporate bond market is 27 per cent of China’s and 69 per cent of South Korea, indicating there is a long way to go for the domestic market.Stressing on the need for developing corporate bond market, Sinha said we have not been able to achieve much despite the “despondent” efforts put in the recent years.