Context:
India overtakes Hong Kong to become 4th-largest stock market.
Stock Market:
- Buyers and sellers trade equity shares of public corporations.
- Free-market economy – allows access to investor trading and capital exchange.
- Top 3 stock markets – USA, China, and Japan
- India has 2 stock exchanges –
- The Bombay Stock Exchange (BSE)
- The National Stock Exchange (NSE)
- SEBI – Regulator of the securities market
Free Market Economy:
- Prices of goods and services are determined by supply and demand
- No interference from government regulation.
SEBI (Securities and Exchange Board of India):
- Statutory body
- Apex regulatory authority
- Headquarters – Maharashtra
- 4 Regional offices – New Delhi, Kolkata, Chennai and Ahmadabad.
The Bombay Stock Exchange (BSE):
- Oldest and largest stock market in India
- Established in 1875
- Location – Mumbai
The National Stock Exchange:
- Leading stock exchange in India,
- Headquarter – Mumbai
- Established in 1992
- Largest stock exchange under market capitalization and trade volume.
Source: The Hindu
Previous Year Question
With reference to India, consider the following statements:
1. Retail investors through demat account can invest in ‘Treasury Bills’ and ‘Government of India Debt Bonds’ in primary market.
2. The ‘Negotiated Dealing System-Order Matching’ is a government securities trading platform of the Reserve Bank of India.
3. The ‘Central Depository Services Ltd.’ is jointly promoted by the Reserve Bank of India and the Bombay Stock Exchange.
Which of the statements given above is/are correct?
[UPSC Civil Services Exam – 2021 Prelims]
(a) 1 only
(b) 1 and 2 only
(c) 3 only
(d) 2 and 3 only
Answer: (b)
Explanation:
Established through a Government of India resolution, CDSL is a non-statutory body.
BSE Ltd. and prominent banks, including State Bank of India, jointly promoted CDSL. The Reserve Bank of India is not involved as a promoter.
