The Securities and Exchange Board of India (SEBI), the watchdog of the Indian securities market, has announced that the service providers of the debt and capital markets would remain operational during the lockdown, which has been extended until the 17th of May by the Central Government.
The government on Friday announced that the extended lockdown would be of a limited version. The lockdown 3.0 has continued with the suspension of airlines, railways and inter-state travel. The government has categorised the regions into green, orange, red, and containment zones, depending on the number of coronavirus infections.
The guidelines of the Union Home Ministry allows the undisrupted services of specific sectors. This includes the operations of the market regulator, service providers (only those that are notified by the SEBI) of both debt and capital markets. As per the guidelines issued by the Home Ministry, the market watchdog has declared certain entities to continue their operation amidst the lockdown.
The following are the market participants that are exempted from the nationwide lockdown: stock exchanges, custodians, depositories, clearinghouses, asset management companies (AMCs), mutual funds, trading members, depository participants, stockbrokers, share transfer agents, clearing members, and registrars.
Apart from that, debenture trustees, credit rating agencies, alternative investment funds, foreign portfolio investors, and investment advisors are also permitted by the SEBI to continue their operations.
In late March, an association of stock market brokers had requested the SEBI to close the equity markets citing high volatility due to unprecedented developments in the world of global investment and finance. The brokers demanded the SEBI to request government authorities to classify market operations as essential, but that did not happen.
The brokers were unable to keep their services as per the standards and investors’ expectations as they were unable to reach their workplace due to the nationwide lockdown. The latest announcement made by the SEBI has provided stockbrokers with the much-needed relief now.
For any clarifications/feedback on the topic, please contact the writer at firstname.lastname@example.org
Engineer by qualification, financial writer by choice. I am always open to learning new things.