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Indian market 'will remain steady'

19 October 2007
Economic growth in India will remain steady for the long-term, according to one stock market operator.

The Indian stock market suffered a sudden ten per cent drop earlier this week but managed to close at just 1.7 per cent below its opening level.

Jeff Chowdhry of F&C's Emerging Markets Fund believes that this shows the strength of the country's stock market.

Some investors are reportedly concerned about proposals made by regulator Securities and Exchange Board of India (SEBI) to restrict the use of participating notes in trading.

The exact provisions of these proposals are unclear and this is what has worried some traders.

"At this stage, the full extent of the impact of these proposals should they be put into practice is difficult to measure but the long term investment story for India remains compelling," commented Mr Chowdhry.

According to Forbes, the Indian stock market has been "extremely volatile" since the proposals to restrict participatory notes - which allow anonymous foreign investment - were released.

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