FPOs come and go, nation's reputation not impaired: FM Sitharaman

Sandeep Dikshit

New Delhi, February 4

Union Finance Minister Nirmala Sitharaman on Saturday dismissed the withdrawal of Adani FPOs as of little consequence and said the meltdown of India’s fastest rising group during the Modi Government would impact neither the country’s macroeconomic fundamentals nor its reputation.

Passing the onus of probing the Group’s alleged misdoings to regulatory bodies, she said, “FPOs come and go. These fluctuations are there in every market. But the fact that we have had $ 8 billion enter the economy these last few days proves that the perception about India and its inherent strength is intact. Public sector financial institutions such as the RBI, LIC, SBI and PNB have already stated that they have very little exposure to Adani stocks.

“How many times have FPOs withdrawn from this country and how many times has the image of India suffered because of that, and how many times have the FPOs not come back?” she said at a press conference in Mumbai amid reports that the Adani Group has postponed a bond issue of Rs 1,000 crore following the tanking of the shares of its companies..

Asked about the serious allegations of fraud made against the Adani Group, the Union Finance Minister said, “It will be regulators who will do their job…regulators independent of the government will do what is appropriate…so the market is well regulated. For keeping the market and the markets regulated in prime condition, the SEBI is the authority and it has the wherewithal to keep that prime condition intact,’’ she added.

“As a result, investor’s confidence, which existed before, shall continue even now. Our regulators are normally very-very stringent about governance practices and therefore, one instance, however much talked about globally it may be, is not going to be indicative of how well financial markets are governed,” said the Minister.

As if on cue, the SEBI, which has kept mum for the past week, in a statement said it “seeks to maintain orderly and efficient functioning of the market and has put in place a set of well-defined, publicly available surveillance measures to address excessive volatility in specific stocks.’’

The SEBI did not give any indication of a probe and merely said that “in all specific entity-related matters, if any information comes to its notice, then, as per extant policies, the same is examined and after due examination, appropriate action is taken.’’ Several Opposition leaders as well as experts have questioned the SEBI for its silence and have sought a Joint Parliamentary Committee probe.

BSE and NSE have already put three Adani group companies under their short-term additional surveillance measure (ASM).

Meanwhile, Union Finance Secretary TV Somanathan on Saturday stood by his comment where he called it a storm in a tea cup. Apparently responding to a tweet by Congress leader Jairam Ramesh that the official has accepted that the Adani saga was a “storm’’ albeit in a tea cup, Somanathan clarified that his comments were in the context of macroeconomic terms and the stability of India’s public financial institutions.