BJP demands JPC probe into tumbling stock market

New Delhi, Jun 9 (UNI) Taking exception to the statement of Finance Minister P Chidambaram exhorting the investors to keep faith in the stock market, the BJP today demanded a probe by the Joint Parlimentary Committee or the Committee on Finance into the reasons for the recent market crash leading to erosion of huge market capitalisation.

BJP Investors Cell, Convenor and former MP Kirit Somaiya said the sensex figures went up from 9,000 to 12,600 points in just three months but the Finance Ministry was keeping quiet and the Minister went on advising the small investors and FIIs like LIC and UTI to continue investing in the ''crashing'' stock markets.

''I feel that a healthy organisation like LIC is reduced to another UTI,'' Mr Somaiya told newspersons adding it was important to know what kind of advise the Minister tendered to UTI and LIC and the extent of their investments.

He said many of the 110 Initial Public Offerings offered to public in recent days were allowed to charge a hefty premium. ''They lured public investments and now 58 of them were quoted below par resulting in huge loss in the stock markets. He said there were 1,25,00,000 small investors in the market besides 75 lakh mutual fund investors,'' Mr Somaiya said.

He said that government will have to come clear on the guidelines about the Participatory Note route popularly known as 'PN Route' which was not at all transparent.

He said the PN Route investments by the FIIs which stood at 15 per cent during the NDA regime had increased phenomenally at nearly 88 per cent during 2005-06.

A withdrawal of Rs 6,000 crore in May 2006 by the FIIs had created panic and a downfall of 2000 points in the sensex. ''But this is a disaster for two crore investors. The small investors deserved to be protected and strong measures should be taken against manipulative investments through PN Route,'', he said.

UNI MCN YA HT2002