India’s securities regulator is reviewing position limits for non-agricultural commodity contracts. Chairman Tuhin Kanta Pandey said the aim was deeper trading and greater liquidity while maintaining risk controls. His remarks at an industry convention also addressed the users of commodity markets and the safeguards governing client money, margins, reporting and supervision.
India’s Securities and Exchange Board (SEBI), the regulator of securities and commodity derivatives, is examining position limits for non-agricultural commodity contracts. These limits cap the positions participants can hold. Chairman Tuhin Kanta Pandey said on October 3 that the objective was greater liquidity and market depth while preserving risk controls. He addressed an industry convention in New Delhi, India’s capital.[1], [2]
Pandey said contract design should let markets reach sufficient scale. He identified producers, commercial users, farmers, processors and physical hedgers as groups whose needs should guide market technology. Hedgers use derivatives to manage exposure to changing prices. He called for better efficiency and access alongside fair access and market integrity. Awareness work under Project Jagrook, SEBI’s user-education initiative, is to be strengthened for farmers, producer organizations, smaller businesses and other users.[1]
The chairman said simpler regulation should retain fundamental compliance requirements. Controls over client funds, margins, reporting and supervision remain central. In September, SEBI’s board approved foreign portfolio investor participation in physically settled non-agricultural commodity derivatives, subject to safeguards. That decision preceded the current examination of position limits.[1]
