with the legislative and fiscal framework and the role and operations of the key institutional players. The demand, supply, and ownership structure of equity is presented in the fourth, fifth, and sixth parts, respectively, and the characteristics of the primary and secondary market for equities is provided in parts 7 and 8. The major conclusions of the study are in the final section. Indian capital markets played a major role in the mobilization of savings in the 1950s. Nevertheless, their importance diminished considerably during the period from 1960 to 1980. During the same period domestic savings as a proportion of national income increased substantially from 13.7 percent in 1960-61 to about 22 percent in the mid1980s. While funds raised from the capital market amounted to 13 percent of net domestic savings in the 1950s, they amounted to less than 1 percent in the late 1970s, 0. 4 percent in the 1980s, and 4 percent in 1984 and 1985.' There were two major reasons why capital markets did not play a significant role in the financing of the industrial sector: first, commercial banks and development finance institutions were able to provide priority sectors of industry with the funds needed at a "below-market" cost; and, second, equity was attractive to neither investors nor issuers. Throughout the 1960s and 1970s there was little investor demand for equity as