Sebi Chairman Tuhin Kanta Pandey announced the regulator is examining the introduction of longer-term futures and options contracts, expanding commodity derivatives, and developing bond index derivatives with the RBI. He highlighted India's resilient capital markets and a robust IPO pipeline.
These proposed regulatory changes aim to enhance market efficiency, liquidity, and capital formation in India, potentially attracting more domestic and foreign investment and supporting growth in strategic sectors.
Sebi Chairman Tuhin Kanta Pandey announced on Friday that the Securities and Exchange Board of India is exploring the introduction of longer-term futures and options contracts, alongside expanding commodity derivatives and developing bond index derivatives in partnership with the Reserve Bank of India.
Pandey highlighted the resilience of India's capital markets despite various global challenges, including tariff uncertainties, geopolitical conflicts in West Asia, AI disruptions, and foreign portfolio investor outflows. He noted that while IPO activity has been subdued in the initial months of FY27, a robust pipeline of approximately Rs 1.5 lakh crore remains for the coming months.
Capital formation has continued, with Indian markets facilitating the raising of over Rs 1.5 lakh crore in April and May of FY27, comprising around Rs 70,000 crore through equity issuances and Rs 86,000 crore via corporate bonds. Pandey emphasized the growing strength of India's domestic investor base, particularly retail investors, whose systematic investment plan (SIP) assets now constitute nearly 21% of the mutual fund industry's assets as of May 2026. The SIP stoppage ratio also improved to 95%, indicating more new registrations than stoppages.
Regarding regulation, Pandey reiterated Sebi's commitment to 'optimum regulation' to balance investor protection with market development. He pointed to recent reforms like the T+1 settlement cycle and T+3 IPO listing timeline that have enhanced market efficiency. Sebi's future agenda includes reducing market friction, deepening markets, and ensuring responsible growth. This involves reviewing frameworks for delisting, municipal debt, portfolio management services, and simplifying KYC for foreign investors. Efforts to deepen markets include reviewing securities lending, borrowing, and short-selling frameworks. Sebi is also reviewing the Innovators Growth Platform to support fundraising for strategic sectors and considering measures for REITs and InvITs. Detailed guidelines on responsible AI adoption in capital markets are also planned, addressing areas like surveillance and risk assessment, while acknowledging associated risks.
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