When MCX was started by Jignesh Shah in 2003, a surprised NSE started NCDEX later on. But the feeling of unease settled in when NCDEX was not performing as well as MCX. Then in 2007 came MCX-SX, which was not welcomed by NSE because it threated NSE’s existence in the exchange industry. However, NSE was quiet because after a fight Jignesh Shah only got an approval for only currency segment in the exchange. In 2008, Jignesh Shah stunned NSE with the brilliant concept of electricity futures in India. The birth of Indian Energy Exchange shook NSE in such a way that it created the Power Exchange of India in a joint venture. But, when NSEL which was 99.99% owned by Jignesh Shah, NSE found the weak link they were waiting for. It did not stop from starting NSpot which promoted by NCDEX.
So, why was NSEL crisis engineered? I got the answer when I read Shantanu Guha Ray’s ‘The Target Book’ which talks about NSEL crisis in detail. In 2013, after a bitter court battle, Jignesh Shah made his dream come true. He successfully won a court battle in which he was finally allowed to open equity segment in MCX-SX. And, this was unacceptable by NSE as it over the years it had seen the way Jignesh Shah’s ventures ate away their market share, also decreased their profits by giving people more ventures to trade in. So, when MCX-SX started operating in the equity segment, NSE realised it has had enough. As a result, they engineered the NSEL crisis and felt that entangling Jignesh Shah in web of conspiracy will crush his innovative spirit. This injustice will soon be uncovered given that all the stakeholders worked against Jignesh Shah, FTIL and NSEL.But the truth will soon put NSE in its place.