Given below are two statements:
Assertion (A): SEBI was entrusted with development functions along with its regulatory functions.
Reason (R): The securities market in India was of an emerging nature.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Both (A) and (R) are true and (R) is the correct explanation of (A).
Assertion (A): SEBI was entrusted with development functions along with its regulatory functions. — True. SEBI has a twin task: regulation and development of the securities market. It also has some protective functions.
Reason (R): The securities market in India was of an emerging nature. — True. The market was still emerging, that is, young and growing.
Why R explains A?
A young market needs more than rules. It also needs help to grow, such as trained intermediaries and useful research. Because the market was emerging, SEBI was given development work along with regulation. The twin task was set keeping this emerging nature in mind.
NCERT (Pre-rationalised Edition): “Functions of SEBI Keeping in mind the emerging nature of the securities market in India, SEBI was entrusted with the twin task of both regulation and development of the securities market. It also has certain protective functions. |