Securities and Exchange Board of India (Sebi) Chairman, C B Bhave, on Friday said investors are showing preference for debt instruments and this could lead to the beginning of the development of a vibrant debt market in India.
Bhave said debt market is a much-debated market in India. "Investors have money, and prefer debt instruments for the safety they present. When they see a reliable issue in the market they respond well," Bhave said with obvious hint at heavy oversubscribing of non-convertible debenture issue of Tata Capital recently. This might well be the beginning of debt market in India, he said.
India is in dire need of a well-developed debt market to fund its infrastructure needs. As per the consultation paper on the Projections of Investment in Infrastcture during the 11th Plan (2007-2012), the total investment required for the infrastructure sector will be of the order of over Rs 20,18,700 crore ($492 billion).
Sectoral analyses show that 30.5 per cent of the projected investments will be in power sector, 15.4 per cent in roads and bridges, 13,2 per cent in telecommunications, 12.6 per cent in railways, 3.7 per cent in ports, 1.7 per cent in airports and the remaining in sectors like irrigation, gas, storage, water, sanitation etc.
Bhave said that due to right regulations, Indian companies did not suffer the way their counterparts have across the world.
Having learnt from the present condition of the global economy, he said, SEBI would re-look at the securitisation process in India.