In a significant move for India’s capital markets, SEBI Chairman Tuhin Kanta Pandey revealed plans for a thorough examination of key regulations governing Portfolio Management Services (PMS), Listing Obligations and Disclosure Requirements (LODR), and settlement mechanisms. Stakeholders can expect a detailed consultation paper by June.
Addressing portfolio managers, Pandey stressed the pivotal role of investor protection within the PMS framework. Enhanced transparency has been a positive development, yet rapid market evolution and novel investment instruments demand regulatory updates to safeguard participants.
The regulatory scrutiny will encompass PMS alongside LODR and settlement rules, ensuring they adapt to contemporary challenges. A key focus is leveraging Artificial Intelligence for instantaneous monitoring of market anomalies, facilitating prompt interventions.
Pandey outlined joint efforts with RBI to create tradable corporate bond indices on exchanges, aimed at bolstering market depth and offering diverse options to investors. This collaboration is poised to invigorate the bond segment.
Changes to funding norms for trading are on the horizon, as SEBI prepares to review RBI lending policies and provide inputs. This could translate into tighter controls on leveraged trading practices like margin funding.
With India’s economy racing ahead to claim the third spot globally, the influx of new investors highlights the urgency for SEBI’s forward-thinking reforms. These measures will reinforce market integrity and investor confidence in the long run.