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HISTORICAL PERSPECTIVE of STOCK MARKET IN INDIA

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HISTORICAL PERSPECTIVE of STOCK MARKET IN INDIA
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Abhijeet S
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HISTORICAL PERSPECTIVE of STOCK MARKET IN INDIA - October 15th, 2010

Securities market in India has a long history spanning over a century. The Bombay Stock Exchange is the oldest stock exchange with its origins in the informal trading of stocks in the 1850s and 60s. Its formal operations commenced in 1875.
The securities market was largely unregulated, prior to independence. In 1947, the Capital Issues (Control) Act was passed which formalized and continued its control over the issue of securities imposed during the Second World War.


This Act was administered by the Office of the Controller of Capital Issues (CCI), which was a part of the Ministry of Finance in the Central Government. In 1956, The Securities Contract (Regulation) Act, 1956 (SCRA) was enacted which brought stock exchanges, their members and contract in securities which could be traded, under the regulation of the Central Government through the Ministry of Finance.


In India, the incorporation, regulation and liquidation of companies is under the purview of The Companies Act, 1956. This Act is administered by the Department of Company Affairs (DCA) in the Ministry of Law, Justice and Company Affairs of the Central Government.


The Companies Act, 1956 specifies the form and contents of the prospectus which is required to accompany an issue of securities. Legislations were also enacted which provide statutory role for Chartered Accountants, Cost Accountants and Company Secretaries.


Matters relating to form and contents of financial statements and other matters relating to the disclosures of information to the members are governed by DCA, in some instances through the professional bodies.


For the first four decades of independence, securities markets in India remained in the backwaters of the Indian financial system. The capital markets did not develop in consonance with the rest of the economy due to the limitations imposed on the role of private sector and the control on issue of securities.



Dilution of the holdings of multinational companies at low prices in the late seventies kindled the interests of the lay investors. However, the interest soon dampened and could not be sustained for long. It was not until the middle of the next decade that the interest livened again and became widespread to have a palpable impact on the growth of the securities market.


The changes introduced in the economic policies by the Rajiv Gandhi” Government also provided an active stimulus to the market. Paucity of resources of the financial institutions, hitherto tile sole purveyors of long-term capital, also forced companies to tap capital markets.
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Re: HISTORICAL PERSPECTIVE of STOCK MARKET IN INDIA
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Jitendra Mazee
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Re: HISTORICAL PERSPECTIVE of STOCK MARKET IN INDIA - February 7th, 2018

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Originally Posted by abhishreshthaa View Post
Securities market in India has a long history spanning over a century. The Bombay Stock Exchange is the oldest stock exchange with its origins in the informal trading of stocks in the 1850s and 60s. Its formal operations commenced in 1875.
The securities market was largely unregulated, prior to independence. In 1947, the Capital Issues (Control) Act was passed which formalized and continued its control over the issue of securities imposed during the Second World War.


This Act was administered by the Office of the Controller of Capital Issues (CCI), which was a part of the Ministry of Finance in the Central Government. In 1956, The Securities Contract (Regulation) Act, 1956 (SCRA) was enacted which brought stock exchanges, their members and contract in securities which could be traded, under the regulation of the Central Government through the Ministry of Finance.


In India, the incorporation, regulation and liquidation of companies is under the purview of The Companies Act, 1956. This Act is administered by the Department of Company Affairs (DCA) in the Ministry of Law, Justice and Company Affairs of the Central Government.


The Companies Act, 1956 specifies the form and contents of the prospectus which is required to accompany an issue of securities. Legislations were also enacted which provide statutory role for Chartered Accountants, Cost Accountants and Company Secretaries.


Matters relating to form and contents of financial statements and other matters relating to the disclosures of information to the members are governed by DCA, in some instances through the professional bodies.


For the first four decades of independence, securities markets in India remained in the backwaters of the Indian financial system. The capital markets did not develop in consonance with the rest of the economy due to the limitations imposed on the role of private sector and the control on issue of securities.



Dilution of the holdings of multinational companies at low prices in the late seventies kindled the interests of the lay investors. However, the interest soon dampened and could not be sustained for long. It was not until the middle of the next decade that the interest livened again and became widespread to have a palpable impact on the growth of the securities market.


The changes introduced in the economic policies by the Rajiv Gandhi” Government also provided an active stimulus to the market. Paucity of resources of the financial institutions, hitherto tile sole purveyors of long-term capital, also forced companies to tap capital markets.
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