FISE, in its fourth general meeting at Hyderabad during 1996 had mooted the idea of having inter-connected stock markets in a run up to compete with the NSE and BOLT and appointed P C Shrimal the then president of HSE as convener of the committee. The ICMS committee had decided to set up a system linking all the regional exchanges facilitating trading activity between the exchanges. Responding to their proposal SEBI had advised FISE to promote a new exchange.

Finally, SEBI had given in-principle approval to the new exchange on November 18, 1998. While according the approval SEBI had put a pre-condition that the participating exchanges would commence the same trading and settlement cycle to thatof ISE. The same was now being objected by the regional exchanges.

While expressing his opposition to uniform settlement system, HSE President Rajender Naniwadeker said that by implementing uniform settlement would result in drying up of business in the local exchanges. Further he said, it would amount to injustice to the brokers who have decided against joining ISE as of now. According to him, out of 2,500 and odd brokers from 15 exchanges only 20 per cent are expected to participate in the ISE trading initially.