SEBI to Unveil Netting Paper, Closing Auction Circular Soon: Tuhin Kanta Pandey

• SEBI Chair Tuhin Kanta Pandey announced the imminent release of a consultation paper on netting, potentially today, to enhance operational efficiency for market participants, especially FPIs.
• The proposed netting framework, discussed with the banking system, aims to allow FPIs to offset buy and sell positions, making portfolio rebalancing smoother and more cost-efficient.
• A circular on closing auction reforms is also expected soon, following a revised consultation paper in August 2025, to improve transparency and efficiency in setting closing stock prices.
• Pandey highlighted SEBI's focus on deepening Indian financial markets, particularly debt and corporate bonds, and reducing structural frictions in FPI registration.
• The SWAGAT-FI initiative, approved in September 2025, will simplify onboarding and reduce compliance burdens for low-risk foreign investors like sovereign wealth funds and pension funds.

Why It Matters: SEBI is set to introduce key reforms for netting and closing auctions, enhancing market efficiency and FPI participation.