Markets Navigate Global Turmoil: SEBI Assures Resilience as India Capital Forms ₹1.5 Lakh Crore Amid Volatility

Markets Navigate Global Turmoil: SEBI Assures Resilience as India Capital Forms ₹1.5 Lakh Crore Amid Volatility​

Indian Capital Markets Demonstrate Resilience Despite Global Headwinds​

SEBI Chairman Tuhin Kanta Pandey addressed the market ecosystem at the ET NOW Market Summit on June 12, 2026, focusing on navigating volatility in a 'New World Order.' The address highlighted that while global markets are tested by geopolitical tension, energy shocks, and supply chain fragmentation, the Indian capital market continues to show resilience.

The regulatory body noted that despite challenges such as tariffs, oil price shocks from West Asia conflicts, AI disruptions, and Foreign Portfolio Investor (FPI) outflow, capital formation remains robust in India. In April-May of FY27 alone, the markets facilitated more than ₹1.5 lakh crore through equity and approximately ₹86,000 crore via corporate bonds.

The steady investment momentum is also visible at the retail level. SIP assets now account for nearly 21% of mutual fund industry assets as of May 2026. Crucially, the SIP stoppage ratio declined to 95%, indicating that new SIP registrations are outpacing stopped or completed ones—a strong signal of long-term investor commitment despite market instability.

SEBI’s Approach: Regulation as a Shock Absorber​

SEBI emphasized that while volatility is inevitable, disorder in the markets is not acceptable and must not erode investor trust. The regulatory approach has been characterized by "optimum regulation"—being effective without being excessive—focusing on risk reduction while simultaneously enabling innovation.

The market infrastructure boasts several strengths that enhance safety and efficiency. These include a T+1 settlement cycle, T+3 IPO listing timelines, faster rights issues, direct payouts, and functional blocking of funds. Furthermore, Mutual Institutional Investors (MIIs) are consistently stress-tested through live disaster recovery drills.

In terms of foreign investor engagement, SEBI has improved access by digitizing onboarding processes and implementing the SWAGAT framework for trusted foreign investors. The introduction of net settlement aims to reduce funding costs and forex risk for FPIs, while a revised block deal window facilitates large institutional transactions.

Future Roadmap: Deepening Markets and Reducing Friction​

The path ahead is defined across three key tracks: lower friction, deeper markets, and responsible growth. For reducing market friction, SEBI is reviewing the LODR framework to ensure it remains highly responsive to emerging governance and disclosure requirements.

Independent Directors (IDs) were highlighted as critical contributors, not just questioners of governance. IDs must now contribute to Board discussions concerning modern challenges such as AI, cybersecurity, ESG, and rapid technological change, while safeguarding minority shareholder interests.

The drive toward deeper markets involves comprehensively reviewing the Securities Lending and Borrowing and short selling frameworks. This review aims to better interlink the cash and derivatives segments, thereby enhancing overall liquidity. The focus on derivatives is set to expand with proposals covering early pay-in benefits for options contracts in commodities.

AI Integration and Responsible Investor Growth​

The regulatory agenda places significant emphasis on Artificial Intelligence (AI). SEBI acknowledges that while AI can revolutionize surveillance, risk assessment, and fraud detection, it simultaneously presents risks related to bias, data protection, and accountability. Consequently, detailed guidelines will be issued covering the responsible use of AI in capital markets.

In parallel, "Project Jagrook" represents SEBI's national mission for investor education. This campaign will focus on promoting disciplined, responsible investing through combined physical and digital outreach, utilizing Indian languages.

SEBI also aims to accelerate the infrastructure needed for strategic sectors. The Innovators Growth Platform is under review to better serve long-term capital flows into AI, semiconductors, clean energy, and defense technology. In debt markets, work is underway on a marketmaking framework for corporate bonds and tokenization of corporate bonds.

Concluding that markets will continue to be tested, SEBI reinforced its commitment: "We will keep our markets prepared for shocks, open to innovation, and anchored in trust." The core message for investors remains disciplined investment, risk understanding, diversification, and adherence to a solid plan.