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No payment crisis in the stock market: Sinha

Tarashankar Sahay in New Delhi

The Finance Minister Yashwant Sinha Wednesday assured the Lok Sabha that there was no manipulation of the stock prices at the Bombay Stock Exchange (BSE) and there was no payment crisis in the market.

Replying to the agitated questions of the opposition members during zero hour in the house, Sinha pointed out that there was no manipulation in the stock market and that the recommendations of the report of the Joint Parliamentary Committee (JPC) in 1993 on securities had been implemented.

"There is no possibility of payment crisis in the stock market," Sinha said adding that the SEBI had launched an inquiry into Friday's stock market crash.

Earlier raising the issue, Congress leader S Jaipal Reddy said that the house was concerned about the ongoing meltdown in the stock markets. He also alleged that noted stock broker Ketan Parekh, who is allegedly close to Harshad Mehta, was manipulating the sensex.

According to Reddy, Parekh had allegedly borrowed Rs 500 million a day before the presentation of the annual Budget. This had resulted in the stock market plunging to a 52 week low and had caused considerable concern among the small investors.

Kirit Somaiya, BJP parliamentarian also expressed concerned about the plunging stock market and demanded that the finance minister should make a statement in the house on the ongoing crisis in the stock market.

Congress member Manishankar Aiyar wanted the government to clarify whether it was satisfied that the 1993 JPC report on securities had not been violated.

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