Capital Market in India
India's capital market plays a crucial role in the nation's economic
development, serving as a platform for businesses to raise funds and investors
to participate in wealth creation. This article delves into the intricacies of
the Indian capital market, addressing its significance, challenges, advantages,
One of the primary challenges facing the Indian capital market is the prevalence
of market manipulation and insider trading. The Securities and Exchange Board of
India (SEBI) has been actively working to curb these issues, but they persist,
hindering the market's efficiency and fairness.
The capital market in India offers numerous advantages, such as facilitating
economic growth, providing liquidity to investors, and enabling companies to
expand through public offerings. SEBI's regulations, particularly under the
Securities Contracts (Regulation) Act, empower the market to function
transparently, fostering investor confidence.
However, the market is not without its drawbacks. Volatility, influenced by
global economic factors, can lead to significant fluctuations. Additionally,
regulatory compliance, while essential, can be perceived as cumbersome for
smaller businesses aiming to enter the capital market.
Specifically, the Companies Act, 2013, governs the issuance and trading of
securities. Section 23 of the Act outlines the regulations concerning the issue
of shares at a premium, ensuring fair valuation and protection of investors'
In conclusion, India's capital market is a dynamic and vital component of the
nation's economic landscape. While challenges persist, regulatory bodies like
SEBI play a crucial role in maintaining integrity and transparency. The
continuous evolution of laws and regulations is essential to address emerging
issues and foster a resilient and thriving capital market in India.
Written By: Ankita Paldiya - Manikchad Pahade Law College
Law Article in India
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