One area that has caught regulators’ attention is the rapidly growing derivatives market, particularly futures and options trading.
This report is from this week's CNBC's"Inside India" newsletter which brings you timely, insightful news and market commentary on the emerging powerhouse and the big businesses behind its meteoric rise. Like what you see? You can subscribeBureaucrats, stereotypically but perhaps unfairly, are often seen as moving too slowly. Instead, there's been a flurry of activity this month at a number of regulators across India's financial system.
In 2023, more than three-quarters of the 108 billion options contracts traded worldwide were on Indian exchanges, according to data from the Futures Industry Association. The significant increase over the past five years has been mainly fuelled by retail investors, with the rise drawing the attention of senior politicians.
Similarly, regulators have also banned 80% of the trading activity in the currency futures market to stamp out volatility in the Indian rupee.SEBI, to protect minority shareholders and to prevent the misuse of a listing platform introduced in 2012, is now considering raising the minimum size of such public offers so that it's limited to only"serious companies", Reuters reported this week.
"RBI has been tightening the screws," Rajeev Agrawal, hedge fund manager and managing partner at DoorDarshi India Fund, told CNBC's Inside India.
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