Ban participatory notes: CPM to Govt

The CPIM argued that the massive pull-out of funds, which induced a huge fall in the market, 8220;reflected defiance of regulatory institutions by the FIIs8221;. But it is not clear how and when the regulators had instructed FIIs to refrain from pulling out funds and bringing down the market.

8220;Financial entities that are unwilling to meet the disclosure norms should not be allowed to participate in the Indian capital markets. The CPIM is of the firm opinion that PNs should be prohibited, as has been recommended by the RBI,8221; the party statement said.

The party also said the SEBI discussion paper that proposes partial curbs on PNs and a winding-down of derivatives-based notes within 18 months is 8220;reflective of tentative attitude of the Government in regulating financial entities8221;.