Taming the Shadowy World of Dark Pools

By Kavaljit Singh | Briefing Paper # 17 | July 2014

After operating in the shadows for more than two decades, the murky world of dark pools is coming into the light. On July 1, 2014, the Financial Industry Regulatory Authority (FINRA), independent securities regulator of the US, imposed a fine of $800,000 on Goldman Sachs for failing to ensure that trades in its dark pool trading system took place at the best price. Would an $800,000 fine on Goldman Sachs act as a deterrent to stop predatory behavior? The answer is No. The bank may consider this small fine…

Too Fast to Fail?: The Perils of Algorithmic Trading in the Indian Markets

By Kavaljit Singh | Briefing Paper # 16 | June 2014

Since 2011, algo trading has been swiftly gaining ground in the Indian stock and commodity markets. Algorithmic trading is all the rage in India now but the key questions that are rarely asked: To what extent algo trading be allowed in the Indian equity and commodity futures markets? Do we have a system of checks and balances in place to control dysfunctional algorithms and minimise the possibilities of any flash crash?
Algorithmic trading is based on a technology-driven pre-programmed mathematical model that allows execution of orders at a very high…

India-UAE BIPA: Why Such Desperate Haste?

By Kavaljit Singh | Policy Brief # 2 | January 2014

On December 12, 2013, India and the United Arab Emirates signed a bilateral investment promotion agreement. Since India is currently reviewing all its investment protection agreements, the government has not explained why it has worked out an exception with the UAE. However, for some inexplicable reasons, the text of the signed agreement has
not yet been made available at the official website of Ministry of Finance.

South Africa Overhauls its Investment Treaty Regime

By Sean Woolfrey | Briefing Paper # 14 | December 2013

In November 2013, the South African government introduced Promotion and Protection of Investment Bill as part of an overhaul of the regulatory framework for foreign investment. Based on its review of bilateral investment treaties, the South African government has already terminated many of its existing BITs. Unlike the bilateral treaties, the proposed Bill provides no obligations regarding ‘fair and equitable treatment’ to foreign investors and excludes recourse to international arbitration. After examining various provisions of the proposed legislation, the author concludes that the investment policy overhaul should be commended…

Whither India’s Bilateral Investment Treaty Framework?

By Kavaljit Singh | Briefing Paper # 15 | December 2013

In the light of several notices invoking provisions of India’s bilateral investment agreements and demanding billions of dollars in compensation, the Indian government decided to put ongoing BIPA negotiations on hold and initiated a review of its model BIPA. The briefing paper critically examines the ongoing review process conducted by bureaucrats with no transparency and wider public consultation. The paper suggests a number of key policy recommendations concerning the design and implementation of a model BIPA. India needs to learn lessons from South Africa which has fundamentally changed its…