Author: Ajay Shah, Susan Thomas, Michael Gorham

FORWARD

This book by Michael Gorham, Ajay Shah and Susan Thomas (the latter two
being the foremost independent financial economists in India today) is INDISPENSABLE!
No bookshelf that pretends to be sufficiently knowledgeable about
Indian economics or finance at the beginning of the 21st century can afford to
be without it. It is a must for any financial analyst or economist located anywhere
who has a professional or personal interest in surveying, understanding,
or investing in the Indian economic and financial-market scene.

It is of import for bankers (commercial and investment), capital market
specialists, asset managers, investment operatives in sovereign wealth funds,
drivers of mergers and acquisitions, portfolio managers, institutional portfolio
as well as corporate direct foreign investors, private bankers, emerging market
specialists, brokers in the global securities industry, exchange executives; indeed
for anyone with a professional or investment interest in knowing what makes Indian
markets tick.

I would recommend it for knowledgeable individuals (providing of course
that they are sufficiently literate/numerate to have acquired post-graduate
qualifications) wanting to acquire Indian assets to account for a part of their net
worth. With India well on the way to becoming one of the world’s four largest
economic blocs (after EU, US/NAFTA and China) there can be few people in
the world of finance without such an interest, whether established or nascent.
That automatically implies a very large market for this book.

This volume is an equally important read for policy and decision-makers
in the public or private domains with an institutional interest in investing in
India now or in the near future. It is essential reading for senior officialdom
(whether in national governments, multilateral agencies or foresight-focused
policy institutes) and for accomplished academics in any top university with
an India-focused program.

The canvas this book covers is breathtakingly ambitious in width and scope.
It is equally impressive in depth, content, simplicity and lucidity of writing
style, and its treatment of critical core and emerging issues that influence Indian
financial markets. It is exhaustive in detailing how Indian financial markets have
evolved, and how far they have come since 1992–1993. But it is equally honest
and lucid about how much remains to be done before Indian finance can be
equated fully with markets, instruments, institutions, regulation (in terms of
policy, practice and architecture) standards and practices that apply in the best
of the rest of the world. Astute readers would gain an immediate and definitive
sense of exactly where Indian finance now lies—between being among the more
developed emerging markets (way ahead of China but behind Brazil and Chile)
but lagging much too far behind globally significant markets like Singapore.

Its contents cover the economic backdrop and context for India’s financial
markets; the evolution of its debt and equity markets for both public and privately
issued securities; the role and emergence of Indian securities exchanges
that are now among the most technologically proficient in the world; the belated
emergence of its derivatives market and their subsequent lopsided development;
the increasing role of realty and property investment in Indian financial markets;
and a discussion of routes of entry into India (e.g., via Mauritius) for both
portfolio and direct investors.

That far-from-exhaustive list is one indication (there are many others) why
this book has to be bought (and quickly) by anyone with an interest in “financial
India.” It is likely to be useful both as an operating manual for practitioners with
an India-focused interest as well as a reference work that will remain valuable
for some time to come.

The only hope one can express after reading it is that the authors will be
sufficiently diligent and mindful of the needs of their readership to update it
every so often (at least every five years) to keep them (and their successors)
abreast of how Indian finance continues to evolve and progress a pace.

Percy S. Mistry
Chairman, Oxford International Group
March, 2008