KATHMANDU: Investors have complained of the government’s and the regulator’s apathy towards the share market. Speaking at an interaction — ‘Capital Market: Present Situation and Solution’ — here today jointly organised by Securities Board of Nepal (Sebon) and Nepal Stock Exchange (Nepse), they urged the government to create an environment where investors could freely invest. “There are problems like access to funds, slackening investor confidence about economic growth and lack of incentives to invest in the capital market,” said Dipesh Vaidya, a market analyst. “There is an urgent need to formulate rules and regulations to develop and strengthen the market to bring mutual funds, market pricing process in IPOs and changes in the allotment model,” he said suggesting the need to facilitate market with different investment tools like bonds — government and corporate — preferred shares and derivatives. Nepse — the sole secondary market in the country — is financial sector-dominated, and has not been able to attract companies from different industries to vie for a slice of the capital market to raise capital for the market’s sustainable development. Thus, the capital market that had once touched a high of 1175 points has come down to hover around 450 points at present. On August 13, 2008, Nepse had touched a historic high of 1175 points but on April 1, 2010, it plunged to 452 points, making investors nervous. “The unnatural growth pattern could not sustain long,” said Sashin Joshi, president of Nepal Bankers’ Association (NBA). “Thus, the market bubble burst,” he added. Prakash Rajauriya, general secretary of Nepal Stock Investors’ Association, however, said that Nepse had plunged below its level. “The regulatory authority’s and the government’s apathy is responsible for the poor performance of the market,” he said adding that their attitude had forced investors to close the secondary market fo a while. The regulatory authority not only lacks initiative to educate investors and provide training to market intermediaries but is also weak in surveillance and has failed to ensure immediate disclosure of public information by companies, investors alleged. To enhance liquidity in the market, Vaidya suggested measures like access to funds for investors, providing incentives for long term investors like tax incentive, communicating policies undertaken and working towards building investors’ confidence in the economy. Nepse has also failed to make the trading system efficient. “It needs quick implementation of CDS and clearing members as well as depository institutions,” he said presenting his paper. Nepse has been performing poorly also due to oversupply of shares. The market saw Rs 16,829 million worth issue in the fiscal year 2009-10 — almost double — compared to year ago when a total of Rs 9,968 million worth of shares were issued, Sebon annual report stated.