SEBI plans easier FPI onboarding, wider commodity access: Tuhin Kanta Pandey
Synopsis
SEBI Chairman Tuhin Kanta Pandey has laid out an ambitious reform agenda at the JP Morgan India Conference: easier digital onboarding for foreign investors, access to non-agricultural commodity derivatives for FPIs, new depository receipts on REITs and InvITs, and a corporate bond market-making framework — a package that signals a structural push to internationalise and deepen Indian markets.
Key Takeaways
SEBI Chairman Tuhin Kanta Pandey outlined the regulator's reform roadmap at the JP Morgan India Conference in Mumbai on 22 September 2026 .
The SWAGAT-FI framework for trusted, low-risk FPIs has seen 205 FPIs onboard since it went live on 1 June 2026 .
SEBI plans to expand FPI participation in non-agricultural commodity derivatives , a currently restricted segment.
New depository receipts against REIT and InvIT units are being considered to attract cross-border investment.
A market-making framework for corporate bonds and a Credit Risk-o-Meter for debt instruments are under consultation.
SEBI is also examining net settlement of funds for mutual fund schemes and settlement pricing for derivatives on expiry days.
The Securities and Exchange Board of India (SEBI) is drawing up a broad set of reforms to make Indian capital markets more accessible, efficient and resilient, with Chairman Tuhin Kanta Pandey outlining the agenda at the JP Morgan India Conference in Mumbai on 22 September 2026. The measures span simplified digital onboarding for foreign investors, expanded commodity derivatives access, and new products linked to real estate and infrastructure trusts.
Streamlining Foreign Investor Access
Pandey said SEBI's strategy for foreign portfolio investors (FPIs) has been built around reducing friction at every stage of the investment journey. Onboarding procedures are being made faster, more digital, and calibrated to the risk profile of each investor, he noted.
A key plank of this effort is the SWAGAT-FI framework, designed for trusted, low-risk foreign investors. Since the mechanism became operational on 1 June 2026, around 205 FPIs have already used it, according to Pandey. Designated depository participants have also adopted digital workflows and API-based integration to cut FPI onboarding timelines, and SEBI intends to push wider adoption of such technology-driven solutions across the ecosystem.
Commodity Derivatives and New Investment Products
Among the more significant proposed changes is an expansion of FPI participation in non-agricultural commodity derivatives — a segment currently off-limits to most foreign investors. This comes amid a broader push to deepen Indian commodity markets and improve price discovery.
SEBI is also considering the introduction of depository receipts against units of Real Estate Investment Trusts (REITs) and publicly listed Infrastructure Investment Trusts (InvITs). If implemented, this could open a new channel for cross-border investment in Indian infrastructure and real estate assets, segments that have historically attracted limited overseas participation.
Corporate Bond Market Reforms
On the corporate bond market, Pandey confirmed that work is underway on a market-making framework aimed at improving liquidity, infrastructure and access to the repo market — three structural weaknesses long cited by institutional investors.
SEBI is additionally consulting on the introduction of Fixed Income Channel Partners to broaden distribution through regulated online bond platforms. A separate Credit Risk-o-Meter framework is also under consideration, intended to help investors better assess the credit risk embedded in debt instruments.
Cash Market and Settlement Reforms
Pandey said SEBI is consulting on net settlement of funds for mutual fund schemes in the cash market. Following the establishment of the Closing Auction Session (CAS), the regulator is now examining concerns around settlement prices for derivatives contracts on expiry days, for which a consultation paper has already been issued.
He added that SEBI will continue to strengthen securities lending and borrowing mechanisms and promote hedging and arbitrage activities to improve overall market quality. With several consultation papers already in circulation, the pace of regulatory action under Pandey's tenure is being watched closely by market participants.
Point of View
Especially on corporate bonds, where market-making proposals have circulated in various forms for years without decisively improving liquidity. The SWAGAT-FI uptake of 205 investors is a modest start; meaningful FPI deepening will require the commodity derivatives and REIT depository receipt changes to actually clear regulatory and taxation hurdles that consultation papers alone cannot resolve. India's capital markets have the architecture for depth — what has repeatedly lagged is the execution of reforms that sit at the intersection of SEBI, RBI and tax policy. Pandey's biggest challenge may be less about regulator intent and more about inter-agency coordination.
NationPress
22 Sept 2026
Frequently Asked Questions
What is SEBI's SWAGAT-FI framework?
The SWAGAT-FI framework is a streamlined onboarding mechanism introduced by SEBI for trusted, low-risk foreign portfolio investors. It became operational on 1 June 2026, and around 205 FPIs have used it since then to gain faster market access.
How does SEBI plan to expand FPI access to commodity markets?
SEBI is working to allow foreign portfolio investors to participate in non-agricultural commodity derivatives, a segment they currently cannot access. This is intended to deepen Indian commodity markets and improve price discovery with greater overseas participation.
What are REIT and InvIT depository receipts being proposed by SEBI?
SEBI is considering depository receipts backed by units of Real Estate Investment Trusts (REITs) and publicly listed Infrastructure Investment Trusts (InvITs). These instruments would create a new route for cross-border investors to gain exposure to Indian real estate and infrastructure assets.
What reforms is SEBI planning for the corporate bond market?
SEBI is developing a market-making framework to improve liquidity and repo market access for corporate bonds. It is also consulting on Fixed Income Channel Partners to widen bond distribution online, and a Credit Risk-o-Meter to help investors assess credit risk in debt instruments.
What cash market changes is SEBI consulting on?
SEBI is consulting on net settlement of funds for mutual fund schemes in the cash market, and examining settlement pricing for derivatives contracts on expiry days. A consultation paper on the derivatives settlement issue has already been issued.
