A Decade of Reforms in the Government Securities Market in India and the Road Ahead

Well-developed securities markets are the backbone of any financial system. Apart from providing the medium for channelizing funds for investment purposes, they aid in pricing of assets and serve as a barometer of the financial health of the economy. The Indian securities markets have witnessed far- reaching reforms in the post-liberalization era in terms of market design, technological developments, settlement practices and introduction of new instruments. The markets have achieved tremendous stability and as a result, have attracted huge investments by foreign investors. There still is tremendous scope for improvement in both the equity market and the government securities market. However, it is the corporate debt market, which needs to be given particular emphasis given its importance for providing long-term finance for development.