The Securities and Exchange Board of India (SEBI) is expected to consider a wide-ranging package of market reforms at its board meeting scheduled for June 19, with proposals aimed at improving market efficiency, easing regulatory processes, and expanding investor participation across multiple segments of the financial ecosystem.
Among the key proposals under consideration is the revival of open-market share buybacks through stock exchanges. This mechanism had gradually fallen out of favour following changes in tax treatment and regulatory concerns. SEBI is now examining the possibility of reintroducing the route with stronger safeguards, including enhanced disclosure requirements and restrictions on promoter participation, to ensure transparency and prevent potential misuse.
The regulator is also expected to discuss measures designed to accelerate the launch of schemes under the alternative investment fund (AIF) framework. The proposed changes would significantly reduce approval timelines after regulatory acknowledgement, allowing fund managers to bring new investment products to market more quickly. Industry participants have long sought faster approvals to improve ease of doing business and support capital formation in private markets.
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Another important area on the agenda is the bond distribution sector. SEBI is reportedly considering easing entry requirements for bond platform providers and allowing a broader range of products to be offered to investors. Market experts believe such reforms could deepen India’s retail debt market by making fixed-income investment opportunities more accessible to individual investors rather than remaining concentrated among institutional participants.
On the mutual fund front, the board may approve relaxed intraday borrowing norms for asset management companies. The proposal is intended to provide mutual funds with greater flexibility in handling short-term liquidity requirements, particularly during periods of heightened redemption activity. Regulators believe the move could help funds manage cash flows more effectively and reduce the likelihood of forced asset sales during market stress.
The package of proposed reforms reflects SEBI’s broader strategy of balancing market development with investor protection. By modernising regulations across buybacks, alternative investments, bond markets, and mutual funds, the regulator aims to strengthen India's capital markets, improve operational efficiency, and create a more flexible investment environment while maintaining appropriate safeguards for investors.
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