New Delhi: Rubbishing accusations that the market regulator's move to curb Participatory Notes was too sudden, SEBI Chairman M Damodaran today said the measures were aimed at bringing transparency and not designed at curbing flow of funds into the market.

"We have been accused of, I would say, unfairly doing something too suddenly, shocking markets. I don't think it (action on PNs) is really a question of addressing hot money inflow into India and what might happen should all of them leave one morning," Damodaran said at Fortune Global Forum here.
Later, he told reporters that controlling capital is not his job.

"What we are attempting to do is to give India and the world, the market that people understand better, that people feel more comfortable investing in, that has more products going forward, better access for all categories of investment, more transparency," he said.

Denying the charges that SEBI's move on PNs came suddenly, he said way back in 2004 February, SEBI regulation on Foreign Institutional Investment said these instruments issued to unregulated entities prior to that time should be wound up five years down the line.

SEBI now wants these PNs to be wound up in 18 months, which gives foreign investors two months more than what was originally intended, Damodaran said.

On sub-accounts of FIIs, he said they were originally intended to bring direct investment into Indian markets. "We found that they have become instruments to facilitate others, bringing them in a non-transparent manner," he said.

He said no regulators anywhere would like to bring non-transparent investment in the market.

Source : PTI