Stock Exchanges Growth
Growth of Stock Exchanges: The history of Stock Exchanges in India goes back to the eighteenth century, when securities of the East India Company were transacted. There were 50-60 brokers led by the legendary Premchand Roychand. They formed the backbone of share floatation by East India Company and a few commercial banks.
Corporate shares made their entry in the 1830s and assumed significance with the enactment of the Companies Act in the 1850s. The Bombay Stock Exchange, the oldest stock exchange in India was established in 1875 under the name, Share and Stockbrokers Association.
The stock exchanges are tightly regulated as self-regulatory organizations (SROs) under the Act. In addition to ordinary regulatory powers over the stock exchanges, the Central Government and/or SEBI may nominate up to three members to the board of each stock exchange [Section 4(2) (iii) of the SC (R) Act, 1956 and Section 10 of SC(R) Rules, 1957].
The government and/or the agency have the authority to make, approve and amend the byelaws of the stock exchanges [Section 4(1)(a) &8 of the SC(R) Act, 1956].
In return, the stock exchanges have been granted a strong disciplinary authority (as well as obligations) over their member stockbrokers.
Leading Stock Exchanges in India: The two leading stock exchanges in India are Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). A brief about them is as under:
(a)Bombay Stock Exchange Limited: It is the oldest stock exchange in Asia and was established as “The Native Share & Stock Brokers Association” in 1875. It is the first stock exchange in the country to obtain permanent recognition in 1956 from the Government of India under the Securities Contracts (Regulation) Act, 1956.
(b) National Stock Exchange: Report of the High Powered Study Group on Establishment of New Stock Exchanges, recommended promotion of a National Stock Exchange by financial institutions (FIs) to provide access to investors from all across the country on an equal footing.
Stock Exchanges Growth
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