In a move that would simplify norms and benefit investors, finance minister P Chidambaram has asked financial sector regulators to soon introduce a common demat account for all financial assets.
“Priority should be accorded to the steps like common demat account for financial assets which will add considerable benefits to the consumers,” said Chidambaram at the meeting of the Financial Sector Development Council on Tuesday.
The FSDC is a body of financial regulators chaired by the finance minister to resolve inter regulatory issues and work on comprehensive reform measures.
At present, investors require demat accounts to trade in equities, invest in certain kinds of mutual funds as well as exchange traded funds. Chidambaram, who heads the FSDC, also urged the regulators to resolve all inter-regulatory issues through the sub-committee of the FSDC.
Meanwhile, the FSDC which met in the backdrop of the US Federal Reserve decision to cut its bond purchases further by another $10 billion and they discussed emerging issues relating to financial stability, including preparedness for the impact of US tapering, liquidity crunch and re-pricing of risk. Chidambaram also hoped that the economy would recover in the second half of the fiscal. “Though the deceleration in growth has been arrested in the second quarter of 2013-14, inflationary pressures and structural bottlenecks are some of the factors that weigh down the growth process.,” he said at the FSDC meeting.
The minister’s comments come days before the growth estimates for 2013-14 will be released. But the latest official data revealed lower than estimated GDP growth of 4.5 per cent in the last fiscal. The Council also reviewed the implementation of the Financial Sector Legislative Reforms Commission report, and called for time-bound action on non-legislative measures.