Stringent regulation for derivatives to shield against financial catastrophe: Need for the days

Derivatives can be called the future of the financial world. The growing derivatives market clearly indicates its prominence in the world economy. The derivatives market has already left its impression, when it shook the financial world with global financial crisis (2008). All the world economies crippled after the 2008 financial crisis. The US Government bailed out the US banking and insurance companies from the vicious cycle. India though new entrant to the derivatives market, is gaining momentum with years. India remained unaffected during the 2008 global financial crisis due to good reporting system and clearing and settlement system regulated by Reserve bank of India (RBI) and Securities and Exchange Board of India (SEBI). This paper explores global financial derivatives market and derivatives market in India. The paper observes the financial derivatives market in India and provides suggestions.