'FPIs believe in India's long-term growth story'

For Securities and Exchange Board of India (Sebi) Chairman Tuhin Kanta Pandey, trust is the cornerstone of India's fast-expanding capital markets - and it must be earned every day through action, not announcement. In a fireside chat with Tamal Bandyopadhyay, he talks of various aspects of Sebi's functioning. Edited excerpts:

- 

At your very first board meeting, you spoke about building public trust and sorting out conflict of interest. How do you settle issues and conflicts-not just in the market but also within Sebi? Where are we today on these issues?

It's important to understand that Sebi is an institution. It has been nurtured and developed by several of my predecessors, along with industry and market participants, through collaboration. Today, Sebi has a strong reputation not only in India but also overseas.

Trust is critical, both internally and externally. It does not come from a single measure-there is no magic wand. It stems from a series of actions: Our language, how we communicate, our regulatory framework, and a fair and judicious application of regulations.

Earlier there was concern over whether we had a robust internal framework on managing conflict of interest. We had set up a high-level committee on this aspect. The committee has been deliberating on the matter and engaging with several internal and external stakeholders. Its report is expected by November 10. We will take the next steps, based on its recommendations.

We have never had any five-year period during which foreign portfolio investors (FPIs) have sold so much. Is it only about valuation, or is there something else?

On the basis of my interaction with FPIs and other participants in foreign markets, I find their confidence in India remains high. They believe in India's long-term growth story and also see short-term opportunities.