Regulating Market Integrity: A Critical Analysis Of Insider Trading Laws In India And Their Impact On Foreign Investment Confidence In An Evolving Global Financial Landscape
- IJLLR Journal
- 4 days ago
- 1 min read
Adhisri Bnaerjee, Amity University, Kolkata
Shirshendu Guha, Amity University, Kolkata
“The stock market is a device for transferring money from the impatient to the patient.”
- Warren Buffet
ABSTRACT
Insider trading is widely viewed as a significant threat to the fairness and integrity of securities markets. It entails trading in securities using unpublished price-sensitive information (UPSI), which unfairly benefits certain individuals at the expense of regular investors. In India, the regulations surrounding insider trading have undergone considerable changes, especially under the oversight of the Securities and Exchange Board of India (SEBI). The SEBI (Prohibition of Insider Trading) Regulations, 2015 represented a substantial move towards stricter compliance, improved disclosure requirements, and better enforcement strategies. This article explores the concept of insider trading, outlines the development of its regulatory framework in India, and critically assesses its effects on foreign investment confidence. It posits that strong insider trading regulations are crucial not only for upholding market integrity but also for attracting and maintaining foreign investment. The article also reviews significant legal cases and regulatory obstacles, and proposes reforms to enhance enforcement and boost investor confidence.
Keywords: Insider Trading, SEBI, UPSI, Foreign Investment, Market Integrity, Securities Law
