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Mehta to be replaced, interim Sebi chairman this week

Aditi Phadnis & Surajeet Dasgupta in New Delhi

The government is likely to replace the Securities and Exchange Board of India chairman DR Mehta and appoint an interim chairman by the end of the week.

The process of appointing Mehta's successor is in the final stages and the government has already zeroed in on a few names. Montek Singh Ahluwalia, Planning Commission member, is also believed to have been sounded out but he has turned it down. Ahluwalia, according to sources, is a frontrunner for the post of a director-level job in the IMF.

Senior sources in the government say a decision on Mehta's successor in Sebi will be taken in the next few days. "The problem seems to be that there are few people available who combine the knowledge of the systems governing the stock market with impeccable personal integrity," the sources said.

The process of finding a successor to Mehta has acquired urgency as Sebi cannot be left headless even for a day in view of the crisis in the stock market.

The finance ministry is waiting for a report from SEBI on the reasons which led to the crises. The income tax department, which is also simultaneously investigating the market crash, will fix responsibilities and submit its report by mid-April.

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