Finance Minister Nirmala Sitharman has emphasised the importance of fostering a robust equity market but at the same time maintaining a cautious approach towards speculative activities. The FM was speaking with Network18 Group Editor-in-Chief Rahul Joshi at News18 India’s Chaupal on Monday, September 16, in New Dehi.

Sitharaman highlighted the need to strike a balance between encouraging participation in the markets and ensuring that investors, particularly those with savings, are protected from excessive risk.

“We’ll have to encourage the equity markets to be robust,” Sitharaman said, acknowledging the role these markets play in the economy. She cautioned that when speculative activity becomes too excessive, a sense of caution is necessary.

“We also need to make sure that people with their savings don’t go to engage in high fluctuating or higher risk ventures. No harm in participating in F&O or no harm in going and investing in the equity market, but eventually, we need to be using financial information, authentic information, before we take a call,” she warned.

Sitharaman made it clear that there is nothing inherently wrong with investing in equity markets or in futures & options (F&O) trading, but it must be done thoughtfully.

Stressing the importance of using accurate and authentic financial information before committing one’s savings to any investment, the FM said, “You have to be cautious in speculative trading, but the idea is not to suffocate the market.”

Furthermore, highlighting the importance of investor education, Sitharaman noted that people must fully understand the risks. “Understand the full risks and then engage,” she said.

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