Citizens' Issues
MP Rajeev Chandrasekhar asks FM to make regulatory bodies accountable

According to the independent MP, we have a situation in India where regulators have failed deliberately or because of incompetence, but are still not held accountable

Rajeev Chandrasekhar, an independent member of the Rajya Sabha, who is also a member of the Standing Committee on Finance, has requested Finance Minister Arun Jaitley to undertake a comprehensive review of independent regulators; for significant reforms in governance and building or rebuilding credible and performing regulatory institutions that are capable of handling challenges of economic regulation in today's India.


Mr Chandrasekhar, in the letter sent to the Finance Minister wrote, "We have a situation where regulators have failed deliberately or through incompetence, but are still not held accountable. There are instances of malafide conduct on the part of regulators that are obvious and known, but no action has been possible because of ambiguity of oversight over these regulators. Hundreds and thousands of crores of Taxpayer money has been impacted by regulatory orders and decisions, and there has been unfortunately little or no debate or review of these decisions."


"The recent payment crisis at the National Spot Exchange Ltd (NSEL) was yet another example of poor oversight and regulation, adding to the already severely impaired and adversely affected credibility of the Indian finance sector on the back of recent allegations of money laundering by public and private banks in the country, and the depreciation of the rupee," the MP said in his letter.


Under the existing architecture, the financial sector is regulated by eight agencies, which are Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority (IRDA), Pension Fund Regulatory and Development Authority (PFRDA) and Forward Markets Commission (FMC), Securities Appellate Tribunal (SAT), Deposit Insurance and Credit Guarantee Corporation (DICGC), and Financial Sector Development Council (FSDC).


However, from the consumers’ perspective, the track record of these regulators is a huge disappointment. In fact, there is hardly an example of an investor or saver receiving satisfactory redressal of his grievances from these regulators.


When first introduced in India, independent regulators were envisioned as strong and credible institutions that would safeguard consumer interest and act as catalysts for investments by ensuring a predictable set of ground rules. Instead, they have declined and morphed, in most cases, into a second bureaucracy - indistinguishable in conduct, will and performance from the regular bureaucracy.


Moneylife has been highlighting  the issue of regulators and their lack of accountability towards investors and savers. Key regulators like, RBI, SEBI, IRDA, PFRDA and FMC do not have any mechanism to directly engage with savers.


Consequently, regulated entities like mutual funds, investment banks, insurance companies, banks and their industry associations such as Association of Mutual Funds of India (AMFI), Association of Investment Bankers of India (AMBI), Association of National Exchanges Members of India (ANMI) and Indian Banks' Association (IBA) do not engage with savers either, which is a sad state of affairs.


In fact, almost all industry 'summits' or seminars of insurance companies, capital markets and banks do not even have a token session or panel discussion that invites their investor or customers.


Here is the letter sent by the MP...




3 years ago

Classic examples are IRDA and SEBI.

Irrational and impractical/consumer unfriendly decisions by these authorities has done much more damage to Citizen's confidence in sectors which regulates these authorities.( Frauds in Insurance and stock market/Mutual funds).

Hope real estate regulator comes with MUCH MORE accountability.

This will help in boosting housing industry and confidence of buyers.

Mumbai Metro to begin operations from Sunday, finally!

The Mumbai Metro service will start at 5.30am and continue till midnight with a total of 16 rakes deployed on the sector, serving the glamour and IT centres of Versova and the business and manufacturing areas of Ghatkopar at a speed of 80kmph

From Sunday, 8th June, the 11.4kms long Versova-Andheri-Ghatkopar east-west corridor with 12 elevated stations en route will become operational, proving to be a boon for Mumbaikars, especially with monsoons around the corner.

The Metro service will start at 5.30am and continue till midnight with a total of 16 rakes deployed on the sector, serving the glamour and IT centres of Versova, and the business and manufacturing areas of Ghatkopar at a speed of 80 kmph, RInfra's Mumbai Metro One Pvt Ltd chief executive, Abhay Mishra, told reporters in Mumbai.

The Mumbai Metro project has been plagued by delays, litigation and cost over-runs. There have also been protests from various quarters about the proposed increase in fares. Anil Galgali, an RTI activist and chairman of the Mumbai-based non-governmental organisation (NGO) Athak Seva Sangh, in a letter to Maharashtra chief minister and Mumbai Metropolitan Region Development Authority (MMRDA) Prithviraj Chavan, said that as per the state government's notification, the minimum fare ought to be Rs9, while the maximum fare ought to be Rs13 at least during the initial year of operations.The increased fare band of Rs0 to Rs40 may not go down well with commuters.  

The 12 stations on this new service are Versova, DN Nagar, Azad Nagar, Andheri, Western Express Highway (WEH), Chakala, Airport Road, Marol Naka, Saki Naka, Subhash Nagar, Asalpha Road and Ghatkopar.

The entire Mumbai Metro project will be 146.5 km once completed, and is estimated to cost nearly Rs20,000 crore, scheduled to be completed by 2021.


Market highly overbought – Weekly closing report

Fresh gains may be hard to come by

The BSE 30-share Sensex closed the week that ended on 6th June, at 25,396 (up 1,179 points or 4.87%), while the NSE’s 50-share Nifty closed at 7,583 (up 353 points or 4.89%) for the week. We had mentioned in our previous week’s report that the Nifty will move in a sideways churn with the index moving weekly in the range of 7,200-7,400.

The losses of the past two trading session were wiped off with the gain on Monday. The new government's efforts for bringing in quickness and appropriateness in decision making was cheered by the market. Nifty closed at 7,363 (up 133 points or 1.83%) on Monday.

To expedite the process of decision making and usher in greater accountability in the system, the prime minister's office on Saturday announced that the Prime Minister has decided to abolish all the existing nine empowered group of ministers and twenty-one groups of ministers.

Up marginally from 51.3 in April to 51.4 in May, the seasonally adjusted HSBC India Purchasing Managers' Index (PMI) pointed to a slight improvement in operating conditions and was weaker than the series average.

On Tuesday, RBI's monetary policy review was in line with market anticipation, which helped the indices rise further. Nifty closed at 7,416 (up 53 points or 0.72%).

The RBI kept its main lending rate viz. the repo rate unchanged while cutting the statutory liquidity ratio by 50 basis points after a monetary policy review.

On Wednesday, indices witnessed a struggle to move higher. Nifty closed at 7,402 (down 14 points or 0.18%). Markit Economics said its seasonally adjusted HSBC India Composite Output index edged up to 50.7 in May from 49.5 in April to 50.7 in May, indicating growth in India's private sector output for the first time in three months. Reports were making rounds that the new government could allow foreign direct investment in the e-commerce sector as early as next month.

On Thursday, the market witnessed a gradual recovery. Nifty closed at 7,474 (up 72 points or 0.97%). Prime Minister Modi was reported to be on course to  visit Washington to meet President Barack Obama in September, signalling a fresh start in ties with a leader once denied a visa by the United States.

Market opened with full optimism on Friday. After opening with the highest opening gap since 26 May 2014 the Nifty closed at 7,583 (up 109 points or 1.46%). Sugar stocks were in focus after the Food Minister was quoted as saying, that the government will examine raising import tax on sugar to support local prices and help mills clear dues to cane growers which are estimated at Rs11,000 crore. Government officials said that the oil ministry has to decide on gas pricing issue by 1 July 2014 and that more clarity on the issue may be reached next week.

For the week, among the other indices on the NSE, the top two performers were Realty (12%) and PSE (12%) while the worst two performers were Pharma (1%) and IT (0.28%).

 Among the Nifty stocks, the top five stocks for the week were ONGC (23%); BPCL (20%);
Tata Steel (18%); Hero MotoCorp (14%) and Hindalco (14%) while the top five losers were HCL Technologies (6%); Dr. Reddy's Lab (4%); TCS (3%); Sun Pharma (2%) and ITC (1%).

 Of the 1,466 companies on the NSE, 1,272 companies closed in the green, 186 companies closed in the red while 8 companies closed flat.

 Out of the 27 main sectors tracked by Moneylife, the top five and the bottom five sectors for this week were:

ML Top sector


ML Worst sector








Software & IT Services


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