DEFICIENCIES IN THE INDIAN CAPITAL MARKET
The Indian capital market suffers from the following deficiencies:
- Lack of diversity in the financial instruments.
- Lack of control over the fair disclosure of financial information.
- Poor growth in the secondary market.
- Prevalence of insider trading and front running.1
- Manipulation of security prices.
- Existence of unofficial trade in the primary market, prior to the issue coming into the market.
- Absence of proper control over brokers and sub-brokers.
- Passive role of public financial institutions in checking malpractices.
- High cost of transactions and intermediation, mainly due to the absence of well-defined norms for institutional investment.
In a planned economy, like the one we had prior to liberalisation, ...
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