New Delhi: BlackBerry manufacturers have suggested forming of a joint consultative forum comprising government, users and service providers for drawing up procedures to intercept services likes Enterprise Mail as banning the service would be "counterproductive", reports PTI.
In a letter to cabinet secretary K M Chandrasekhar, Canada-based Research In Motion (RIM), makers of BlackBerry, virtually refused to provide an intercepting technology for its BlackBerry Enterprise Server (BES) and said it had provided options to Law Enforcement Agencies (LEAs) within India's existing techno-legal framework.
RIM said the BES service uses standard technology which was no different from any of the other encryption products used to provide Virtual Private Network on both wireless and wired networks.
RIM said it also strongly believed that the concerns of LEA and the government can only be effectively addressed in a wider dialogue between government and industry.
"Singling out products like BES in the present instance and imposing ban on such services would be futile and counterproductive," vice president of RIM Robert E Crow said in the letter.
RIM said the ban would be futile as anyone who wanted to misuse of Internet encrypted technology would shift to any one of other numerous and freely available options. The step would be counterproductive because any ban or suspension of services like BES, which have played a key role in success of modern business, will affect information security and efficiency of both commercial and government organisations.
The government has given a time of two months to BlackBerry for providing technology for intercepting its BlackBerry Messenger (BBM) service and BES.
"As this issue impacts the Internet industry as a whole, we at RIM therefore earnestly request that a joint consultative forum, of government, users and providers of encrypted services, be established for collectively engaging and assisting the Government to draw up procedures and process that will be adhered to across the board to address the concerns of LEA and the misuse of such technologies," Mr Crow said.
BlackBerry manufacturers claimed that the approach was necessary because network operators and service providers do not have clear access to target information as the users have.
"...As we understand it, many of these users also want the opportunity to directly engage with the government to find solutions," Mr Crow said.
Even as the Sensex scales a 32-month high, thousands of crores are flowing out of equity funds while data from the NSE proves that the Indian equity market is extremely hollow. But regulators are in an ivory tower. They are not listening. This is the first part of a three-part series
A loud gasp of disbelief went up in mid-August when Moneylife reported the data released in Parliament that showed how narrow, shallow and illiquid the Indian equity market is and that it is concentrated in the hands of a few individuals in a few centres.
The minister of state for finance replied to a question in the Rajya Sabha that 50% of the cash market transactions came from a shockingly low 451 investors of which 156 were proprietary traders; 50% of the trading in National Stock Exchange's (NSE) derivatives segment, the main pillar of the Indian stock market system, came from just 106 investors of which 58 were proprietary traders. The minister had sourced this data from the secretive, powerful and extremely profitable NSE.
And, yet, NSE attempted to refute it a few days later - which only raised more questions. But the fact is that the stock depositories have recorded only a modest increase in new accounts over the years. And stockbrokers, who were on a massive expansion spree in 2007, are no longer talking of opening hundreds of branches all over the country. Nor are they hiring furiously.
In early September, when the data for fund flows in and out of mutual funds for August was released, it transpired that another Rs3,000 crore had flown out of equity mutual funds. The total outflow over the past 13 months has been as much as Rs14,000 crore. Moves by the Securities and Exchange Board of India (SEBI) to popularise buying and selling of mutual funds through stockbrokers' terminals have not exactly taken off. The irony is that the stock exchanges, which run with sharp profit motive, have had another great year and market benchmarks have scaled a 32-week high.
The divergence between the apparent market boom and what investors are actually doing is striking. What is the reason for investor apathy? And why do policymakers accept this fact? Nearly 20 years after India embarked on financial liberalisation, why don't we have a significant equity cult? Moneylife has been seeking answers to what went wrong. Well, a lot. One of the key problems could be the lack of interaction between regulators and investors that results in regulations often being formulated without taking into account investor needs and requirements. Even well-meaning regulation sometimes turns out to be a hindrance to market development, but regulators seem unwilling to accept mistakes or consider course-correction even when confronted with strong data. Stock exchanges, which are the first line of regulation, are even more isolated from real investors. They only deal with market intermediaries; even their investor seminars are a one-way communication, that too rarely with top decision-makers.
Moneylife decided to conduct two polls, based on our interactions and the feedback we receive from investors on issues of current importance. The first focused on a recent SEBI diktat that asked brokers to collect detailed financial information from investors, ostensibly to track down and eliminate the flow of black money into stock markets. Many investors think this is pure harassment and a majority are most unwilling to share their entire financial history, in the form of tax returns, with stock brokers. Dozens of such annoying rules are cumulatively responsible for driving investors away from the capital market. It is unjust too, because a big chunk of black money in the markets is routed through disguised sub-accounts of foreign institutional investors (FIIs).
We asked investors what they feel about this SEBI rule. We also asked investors what they feel about the arbitration process and a few issues regarding mutual funds. Our second survey was on portfolio management schemes (PMS) which have collected a huge Rs30,000 crore from investors but have triggered a slew of complaints about mismanagement and losses.
(In the next part, we will look at what investors have to say on a wide range of issues that affect them directly).