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Foreign brokerages quick to move after SEBI ruling

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INTERNATIONAL stockbroking giants have been quick to take advantage of a directive issued last October permitting foreign brokers to assist registered foreign institutional investors (FIIs) and operate on behalf of them on the Indian stock exchanges.

Big names including Jardine Fleming, Citicorp, James Capel, Lehman Brothers, Baring Securities, Kleinwort Benson, Crosby Securities, Credit Lyonnais Securities and Marlin Partners have entered the Indian market.

Realising that FIIs were having problems dealing with Indian brokers, the Stock Exchange Board of India (SEBI) opted to increase the role of foreign brokers to boost the dealings of FIIs.

Now, the movement of brokers into India is gathering further momentum.

It is estimated that more than US$900 million has been pumped into the market in the 12 weeks since the directive, and the number of FIIs registered with SEBI has swelled to 130 - including the top Korean group Daewoo Securities.

The guidelines state that foreign brokers will be allowed to transmit orders to a member of an Indian stock exchange, and only members will be permitted to execute these orders.

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