India's SEBI weighs domestic AI model for securities trading

what happened

India's Securities and Exchange Board of India is putting into practice a supervisory framework for artificial intelligence drawn up by the International Organization of Securities Commissions, Reuters reported, citing Chairman Tuhin Kanta Pandey, who spoke at a summit in Mumbai on Wednesday. The aim is stronger risk control and a flexible governance structure for AI use. SEBI is also studying an AI model dedicated to securities trading that would be built and overseen within the country, treated as public digital infrastructure.

Pandey said AI tools could improve client services, risk scoring and supervision, but only with dependable data, effective model oversight and clear responsibility for decisions. He added that SEBI is reviewing compliance rules for overseas investors and will publish a consultation paper on bringing them in line with global norms. Although access has been eased and onboarding digitised, some domestic obligations still exceed those in other large markets.

Pandey also noted that India needs both local and foreign money to fund its growth plans, and that overseas participation can deepen the capital pool and bring expertise. Reuters noted in August that SEBI planned to loosen disclosure rules for certain high-risk offshore funds, after rules tied to its review of offshore investors connected to the Adani Group drew complaints and legal challenges.

why it matters

For investors, the main signal is regulatory direction: the review of foreign-investor compliance aimed at global standards is the item most relevant to capital flows into Indian markets. The AI measures are unlikely to move prices directly but show how the regulator is shaping market infrastructure.

tags

instruments