Barely six months after the Bimal Jalan Committee submitted its report on ownership and governance of market infrastructure institutions (MIIs), the government set up a new committee to study the contents of the original report.
The move has raised eyebrows. “This is not a common practice,” one of the new committee members told HT. “There seems to be something sinister.”
The panel met last Monday.
The report was submitted to the Securities and Exchange Board of India (SEBI) on November 22. “Hence, it is the SEBI board that has to decide to accept or reject the report. Why is the government getting involved? This is clearly overstepping the autonomy of SEBI.”
“It is a waste of time to set up another committee to examine the original report,” an industry expert said. Jalan, who is travelling, refused to comment.
Another member of the newly set up committee said that a review of the report is critical to ensure that best global practices have been taken into account.
The bones of contention around the Jalan Committee report are two: whether a MII that also has compliance and regulatory roles should be listed and whether it should make excess profits.
“We discussed the role of a stock exchange and how if it became a pure commercial entity on listing could create a conflict of interest with its regulatory role,” said a member of the new committee headed by Renuka Kumar, joint secretary, Ministry of Corporate Affairs.
“It could take a long time to segregate the two roles,”an MCX spokesperson said. A NSE spokesperson refused to comment.