'Establishment of new stock exchange is mandatory if NEPSE is not going to adopt changes soon' - Dipendra Agrawal

Stock market is an important part of the economy of a country. It plays a pivotal role in the growth and commerce of the country that eventually affects the economy of the country to a great extent. That is the reason that the government, Securities Board of Nepal (SEBON) and even Nepal Rastra Bank, the central bank of the country keeps a close watch on the happenings of the stock market. The stock market is important from both industrial and investors’ point of view. That is why; a rising stock market is a sign of developing and growing economy of the country. The function of the stock market is that of a common platform for the buyers and sellers of stocks listed in stock market. It is the secondary market of the stock exchange where retail investors and institutional investors buy and sell stocks. In fact, stock market traders are the one to raise fund for the businesses by investing in the stocks.
So, stock market is not only providing funds required for boosting the business, but it’s a common place for stock trading to add up. It is the stock market that makes stocks a liquid asset unlike the real estate investment. It is the stock market that makes it possible to sell the stocks at any point of time and get back the investment along with the profit. It, in turn, makes stocks much more liquid in nature thereby attracting investors to invest in the stock market. The Board has approached Nepal Stock Exchange Limited (NEPSE) repeatedly for improvements in programs but to vain it has only confronted failure every now and then. Monopoly, lack of competition, lack of proper manpower, lack of willingness to grow and adapt with changes, outdated software and lengthy policies are the main reasons for failure of impoverishment in policies of NEPSE. These problematic issues should be tackled immediately by SEBON and the Finance Ministry. If it doesn’t respond to the need of the hour, a new stock exchange should be established with immediate effect as it will help the economy as a whole. NEPSE has failed to stop its brokers from making negative comments done in media. It has failed in providing license to the banks and online trading. Is NEPSE only the property of 50 brokers? Are they the only firms to seize money from the market not the investors? Are these brokers the biggest influencers to stop licensing to other institutions? A big question is whom are we working for? Is it brokers or the investors? These questions should be answered immediately; otherwise questions will be raised on the presence of the Board as well. Lastly, if we cannot protect Nepalese investors from the raging manipulation going on in the market how can we ask foreigners to invest in our market?  *(The author is Board of Director at Mega Bank Nepal Limited, member of Investors’ Forum and share market analyst.)