India markets regulator weighs domestic AI model for securities trading, chairman says

India’s markets regulator is working to implement a global supervisory toolkit for artificial intelligence and is considering developing a domestically governed AI model specifically for the securities market, its chairman said on Wednesday.

The Securities and Exchange Board of India is implementing the International Organization of Securities Commissions’ supervisory toolkit to strengthen risk management and develop an agile governance framework for the use of AI, Chairman Tuhin Kanta Pandey said at a summit in Mumbai.

SEBI is also exploring a securities market-specific AI model that could be built and governed domestically as a form of digital public infrastructure, Pandey said.

AI-enabled tools could improve services, risk assessment and supervision, he said, adding their use requires reliable data, effective oversight of models and clear accountability for decisions.

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Pandey also said SEBI was reviewing compliance requirements for foreign investors and would issue a consultation paper seeking views on aligning them with global standards.

While India has streamlined market access, eased digital onboarding and simplified procedures for overseas investors, some domestic compliance requirements remain more onerous than those in other major jurisdictions, he said.

“India will need both domestic and foreign capital to support its growth ambitions … international participation can widen the pool of capital and bring expertise,” Pandey said.

Reuters reported in August that SEBI planned to relax disclosure requirements for certain offshore funds deemed high-risk, after rules introduced during its scrutiny of offshore investors linked to the Adani Group triggered complaints and legal challenges.