India is 2nd fastest growing economy: Chidambaram

Mumbai, Apr 11 (UNI) India, with an average economy growth of 8.6 per cent in past three years, is the second fastest growing country in the world and has attained a foreign exchange reserve of 200 billion dollars, which exceeds its external debt of 143 billion dollars, Finance Minister P Chidambaram has said.

He was speaking after inaugurating the 32nd annual conference of the International Organisation of Securities Commissions (IOSCO) here today.

''The two bench mark indices, NSE Nifty and the BSE Sensex, have given a compound average annual return of 29 per cent and 33 per cent respectievely in the last three financial years. In terms of market capitalisation at over 850 billion dollars, the Indian security market has turned the fifth largest market in the Asia-Pacific region after Japan, Australia, Hong Kong and Korea,'' he said.

While the challenges before the market regulators are increasing from inflation to the potential threat faced by the emerging market economies (EMEs), the global flows of capital has made it necessary for cooperation and exchange of information between the market watchdogs, he said.

''Many banks in India have responded proactively to tighten liquidity to check the increase in inflation. Though certain challenges originating from abroad are of little control to us, steps including the upgradation of the risk management system, improving the risk management system and governing standards will change the challenges to opportunities,'' he added.

Meanwhile, two more Memorandam of Understanding (MoU) were signed today by the Securities and Exchange Board of India (SEBI) with the securities exchange commissions (SECs) of Taiwan and Indonesia.

SEBI Chairman M Damodaran signed the MoUs with Sheng-Cheng Hu, chairman of Financial Supervisory Commission (FSC) of Taiwan and Dr A Fuad Rahmany, chairman of Indonesian capital market and financial institutions supervisory agency BAPEPAM-LK.

SEBI has signed bilateral MoUs with eight other jurisdictions in the past.

A public panel on securities exchange evolution and the regulation of transnational securities exchange was also held today.

UNI