Monday, May 14, 2018

25 May 2018: Political Economy of Market Development: Why India's Equity Market Reforms Have Succeeded While Its Corporate Debt Market Has Not

John Echeverri-Gent
University of Virginia

India’s equity markets have been transformed from the backwaters of the global market with outdated trading technologies and regulatory institutions to world class institutions using cutting edge technology. At the end of 2017, National Stock Exchange and the Bombay Stock Exchange had the ninth and tenth largest domestic market capitalization in the world, and they operated settlement and regulatory standards at the global cutting edge. At the same time, India’s market for corporate bonds lagged far behind global standards. In 2013, the value of Indian corporate bonds as a percentage of GDP was only 5.4% trailing far behind not only economic powerhouses like Republic of Korea (77.5%), Singapore (37%), Hong Kong (31.4%), and China (13%), but also less successful economies like Malaysia (43.4%) and Thailand (15.9%). More than 94% of corporate debt was raised through private placement rather than on the open market. This talk develops a political economy approach to explain why India’s equity markets have rapidly developed and its corporate debt market has not.

Date: May 25, 2018
Time: 04:30 P.M.

Conference Hall, Ground Floor
R&T Building
National Institute of Public Finance and Policy,
18/2 Satsang Vihar Marg, Special Institutional Area,
New Delhi-110067(INDIA)

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