The Securities and Exchange Board of India (SEBI) is assessing the possible impact of COVID-19 on the markets and taking steps to tackle the same, said S. K. Mohanty, whole-time member, SEBI.
“SEBI is aware of the coronavirus and the possible impact that it can have on the market. We are taking necessary steps,” he said. on the sidelines of a capital market summit organised by industry body Assocham.
“We’ve seen the RBI statement. Whatever has to be done, has to be done. We are internally assessing the situation,” he added.
The SEBI statement comes a day after the Reserve Bank of India (RBI) said it was monitoring the financial markets closely on account of the virus scare.
Asked if the issue had been discussed at the Financial Stability and Development Council (FSDC), which has representations from all regulatory bodies, the SEBI member said, ‘not yet.’
The impact of COVID-19 in India has been visible in most segments of the markets, including equities, currency and bonds.
Incidentally, the last few trading sessions had seen the benchmark Sensex shedding more than 3,000 points while the rupee went past the 73-mark on Tuesday and bond yields dropped 11 bps on Wednesday.
Tax on REIT, InvITs
On a different note, the capital markets regulator has taken up with the government the issue of taxation with respect to dividends from real estate investment trusts (REITs) and infrastructure investment trusts (InvITs).
A Budget proposal has made dividends from such structures taxable, which, market participants believe, would be a huge dampener for the segment.
“...the taxation part is not in the hands of SEBI, but we have taken it up with the government, let’s hope for the best,” said Mr. Mohanty.
“If that (change or amendment) happens, if we stick to the taxation incentive to REITs and InvITs given in 2016, if that is restored, then definitely billions of dollars India would get and will help our economy in a great way,” he added.
