Security and exchange Board of India (SEBI)

The capital market in India has been evolving for the last five years. The market has shown a great deal of buoyancy in terms of market capitalization and variety. This has given rise to the need to regulate,moderate,and set standards for an orderly growth of capital markets in the country.

Even earlier,the Government had felt the need to regulate the capital market. Therefore it enacted the securities control regulation act (SCRA),1956. The purpose of this act was to stop the conditions of disorder,such as emergence of speculation and lack of discipline among brokers, in the working of stock exchange and to protect the investor's interest.

However the SCRA 1956 faced criticism because the Act was seen unduly interfacing with the internal autonomy of the sock exchanges.

The subsequent opening up of the economy and the emergence of active stock market gave rise to the need to put in place more elaborate control mechanism to ensure orderly growth and functioning of SEs and measures to protect the interest of investors. This requirement saw the emergence of Security and Exchange Board of India (SEBI) as a powerful controller and watch dog institution in all matters pertaining to the orderly growth of capital markets in India.

SEBI has become functional on the 30th day of january,1992 as a corporate body with its headquarters in Mumbai.

SEBI is a composed of the following members:

A chairman
Two members from the ministry of Finance and Ministry dealing with companies act,1956.
One member who is an official of RBI.
Five other members to appointed by the central Government of which three of them should be for whole time members

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