India's capital markets are increasingly being recognised as a stable, resilient and globally competitive destination for long-term investments, according to Tuhin Kanta Pandey, Chairman of the Securities and Exchange Board of India (SEBI). Speaking at the IMF-World Bank Spring Meetings during an interaction organised by the Confederation of Indian Industry (CII) and the US-India Business Council, Pandey emphasised that Indian markets have evolved into a structural pillar of the financial system, backed by strong macroeconomic fundamentals and a steadily expanding investor base. He noted that SEBI has adopted a facilitative and risk-based regulatory approach aimed at enhancing efficiency and investor confidence, with controlled inflation, healthy foreign exchange reserves and stable external accounts continuing to support the country's growth trajectory, which remains among the strongest globally.
India demonstrated exceptional fund mobilisation capabilities in FY26, raising over $154 billion through equity and debt markets, reflecting sustained investor appetite. According to the report, mutual fund assets under management are nearing $900 billion, while commitments to Alternative Investment Funds (AIFs) have crossed $175 billion. Foreign portfolio investors currently hold nearly 17 per cent of listed equity with assets under management of about $780 billion. The robust IPO activity and diversified sectoral base spanning healthcare, consumer services, energy, commodities and technology have supported market growth significantly, with equity net fund flows surging 11 per cent in March led by manufacturing and infrastructure sectors.
There has been a parallel push to deepen non-equity segments, with India's corporate bond market approaching $650 billion in outstanding value. As reported by The Hindu BusinessLine, Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) are gaining traction as vehicles for financing long-duration assets. These segments are increasingly seen as critical for funding infrastructure and supporting broader economic growth. The depth of domestic participation, alongside steady foreign inflows, has been a key driver of market stability and growth, with the rising role of domestic investors providing additional depth and resilience to help Indian markets better withstand global volatility.
SEBI's regulatory approach remains facilitative, risk-based and consultative, with a focus on balancing investor protection, market development and integrity. Key reforms include the rollout of T+1 settlement cycles, faster initial public offering (IPO) timelines, and simplified access for foreign investors. The regulator has also implemented measures such as easing Foreign Portfolio Investor (FPI) registration and re-KYC processes, along with greater digitalisation to streamline investment flows and deepen market participation. Pandey highlighted the regulator's focus on a transparent, consultative and technology-driven framework, with plans to further streamline capital-raising processes, simplify FPI registration and set up a dedicated digital portal for foreign investors.
Market participants have identified areas for improvement, including the need to improve secondary market liquidity, expand investor awareness and address taxation issues, particularly in fixed-income markets. According to the report, SEBI will continue efforts to strengthen equity, debt, derivatives and private capital markets. The interaction brought together global investors, venture capital leaders and policymakers, with discussions centred on expanding investment opportunities and strengthening the India-US economic partnership. Participants also shared feedback on simplifying regulatory processes, improving clarity in cross-border investment frameworks and boosting the availability of capital for emerging sectors such as deep technology, as reported by IANS.
