Bimal Jalan Committee Report on stock exchanges sparks debate

The Bimal Jalan Committee report on stock exchanges is a good report and well-argued though the committee may have erred on the side of caution," Rajesh Chakrabarti, assistant professor ­finance,ISB,observed on Friday . Kicking off a panel discussion on the report held in the city,  Chakrabarti pointed out that the 5% cap, the maximum stake that individuals and corporations can hold in an exchange, was the rule in many countries. He also argued that stability and not mindless competition was more important. Competition, he said, could be sub-optimal and "haven't really done too much on Wall Street". An exchange chief's role was to bring ininvestors to trade at one place and increasing the number of exchanges could lead to greater fragmentation.