MUMBAI/BENGALURU, Aug 11 (Reuters) – India’s markets regulator, the Securities and Exchange Board of India (SEBI), announced a proposal on Tuesday aimed at expanding foreign investors’ access to non-agricultural commodity derivatives. The proposed changes would permit these investors to trade in physically settled contracts, according to a proposal paper published on SEBI’s website.
Currently, overseas investors are restricted from participating in physically settled contracts for commodities such as crude oil, natural gas, gold, and silver. These contracts require the actual delivery of the underlying goods upon settlement.
SEBI stated that allowing broader foreign participation is expected to have several positive impacts on the Indian commodity derivatives market. These include deepening market liquidity, enhancing price discovery mechanisms, and better aligning India’s commodity market with global standards and practices.
