The Securities and Exchange Board of India (Sebi) is taking steps to enhance institutional participation in both agricultural and non-agricultural commodity markets, aiming to make them more attractive for hedging and investment. Sebi Chairman Tuhin Kanta Pandey shared these plans on Thursday during the Bloomberg Forum for Investment Management.
“Strengthening India’s agri and non-agri commodity markets is critical,” Pandey said, adding that the regulator intends to adopt a thoughtful and consultative approach in implementing further reforms. He highlighted that deepening the cash equities and derivatives markets remains a high priority.
Expanding Access for Institutional and Foreign Players
Sebi is actively engaging with the government to allow banks, insurance companies, and pension funds to participate in non-agriculture commodity derivative markets. The regulator is also reviewing proposals to permit foreign portfolio investors (FPIs) to trade in non-cash settled, non-agricultural commodity derivatives, a move that could bring greater liquidity and stability to these markets.
Corporate Bonds and Municipal Market Reforms
In addition to commodities, Sebi is working to deepen the corporate bond market, making it more accessible for both issuers and investors. The regulator is examining bond derivatives as another tool to strengthen this segment. Meanwhile, the growth of municipal bonds is being encouraged through targeted regulatory reforms and outreach programs.
Driving Market Efficiency and Hedging Opportunities
By enhancing institutional participation and introducing foreign investors to key derivative markets, Sebi aims to create a more robust, transparent, and efficient ecosystem
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