SEBI plans bank, pension fund entry into non-agri commodity derivatives

Capital markets regulator SEBI will engage with the government to allow banks, insurance companies and pension funds to participate in non-agriculture commodity derivative markets, its chairman Tuhin Kanta Pandey said on Wednesday.

Speaking at an event organised by the Multi Commodity Exchange (MCX), Pandey said the Securities and Exchange Board of India (SEBI) is also considering a proposal to permit foreign portfolio investors to trade in non-cash settled, non-agricultural commodity contracts.

“We will also engage with the government to consider banks, insurance companies and pension funds to trade in these (non-cash, non-agricultural) markets,” Pandey said, adding that by December 2025, SEBI will bring commodity-specific brokers under a common reporting mechanism for compliance.

Pandey also said that the commodity markets have to play an important role in ensuring rare metals security for the country.

SEBI’s board last week approved a raft of reforms to initial public offerings (IPOs), disclosure rules and investor participation norms to deepen capital markets and improve ease of doing business.

The regulator revamped the share-allocation framework for anchor investors in IPOs. Life insurance companies and pension funds will now be eligible for reserved anchor portions, which until now were limited to domestic mutual funds.

The overall anchor reservation has been increased from one-third to 40%, with one-third continuing for mutual funds and the rest for life insurers and pension funds.

The limit on anchor investors for IPOs with anchor portions exceeding ₹250 crore has also been raised from 10 to 15 per ₹250 crore.