This was stated by Sebi executive director Pratip Kar at a session on financial and consulting services at the global Indian entrepreneurs conference organised here by the Federation of Indian Chambers of Commerce and Industry (Ficci) on Friday.

Kar, however, said a final decision has not been taken as yet and that the market regulator is weighing various options on dematerialisation.

The National Securities Depositories Ltd, meanwhile, has opened depositories in 35 cities across the country. It is looking at opening more depositories to encourage paperless trading.

Kar added that the Sebi has been holding discussions with Reserve Bank of India (RBI) and State Bank of India on making the depositories accessible to non-resident Indians. In response to a query from the floor, Kar stated that Sebi was looking at installation of terminals of National Stock Exchangeand Bombay Stock Exchange in the Gulf nations to enable NRI trade. He said the plans were at a premature stage though Sebi was in the process of preparing a blueprint for the purpose.

On initiatives being taken to address the grievances of NRI investors, Kar said, Sebi had set up a cell and designated an officer to deal with NRI complaints a month ago.

On permitting venture capital funds, the Sebi executive director said that there was a growing realisation at the government and the regulator's level of the need to develop it well. Industrial Finance Corporation of India chairman, P V Narasimhan, said the risk taking capacity of Indian financial institutions has increased substantially in the last few years.

Narasimhan stated that the institutions prefer consortium financing of projects as such mode would minimise their individual risks and also enable them to share expertise.

Addressing the delegates at the conference, Narasimhan said lending by banks and financial institutions has grown at 25 percent and this growth should be sustainable with adequate savings and liberalisation of provident fund.

On the issue to make conditions conforms with international standards, Narasimhan said Indian institutions and banking are moving away from standards they were following so far to make it conform with international norms. He said: "We do not have any problem in moving towards international norms completely, however, this has to go hand-in-hand with promoters readiness to conform with international norms as well." SBI chairman M S Verma said : "The Indian institutions are capable and willing to support big complicated projects besides introducing new financial products."

He added that institutions were now willing to fund Rs 1,000 crore for single fairly complicated projects. Verma said that institutions and banks are looking at introducing new products such as those which would "enhance credit" to fund the projects.

Verma revealed that the financial system would see the launch of new products likeinterest hedge instruments in some time next year. He added that it was felt that risk management was not possible as hedging was not being allowed.

"The measures in the recent credit policy have brought the introduction of interest hedging products just months away," he said. Additionally, institutions and banks are looking at pooling resources.

Another speaker, JNA Capital Inc president, Amit Sarkar, stated that domestic capital should flow freely before international capital. He added that focus on the domestic economy was more import than focussing on international economy.

He felt that if India was to post growth rates of 15 per cent annually, the country would be in a position to attract more investment.

Sarkar suggested that the country focus on improving its image and work on reducing the perceived risk of investing in the nation. Additionally, breaking the barrier to entering the US market should be the top priority of the government. Citing the example of software exports, Sarkar pointed outIndian software exports accounted to just about 0.4 per cent of the US software market.

More importantly, India should focus on creating conditions that make locals anxious to invest in the country. For this, it is necessary to dismantle the pervasive control of the govern ment.