Tuhin Kanta Pandey, Chairperson of the Securities and Exchange Board of India (SEBI)
| Photo Credit:
FRANCIS MASCARENHAS
The Securities and Exchange Board of India (SEBI) Chairman Tuhin Kanta Pandey on Saturday said financial markets must be designed to function efficiently even during periods of uncertainty, as volatility itself is a recurring feature of capital markets.
“If we look at the global economic landscape today, one word appears repeatedly: uncertainty,” Pandey said while speaking at the Moneycontrol Global Wealth Summit 2026. “Conflict in the middle-east has disrupted energy supplies and created volatility in oil and gas markets across the world,” he said.
Markets have experienced similar disruptions in the past but eventually stabilised. “In the recent past, we have witnessed the disruptions caused by the Covid-19 pandemic, followed by the Russia–Ukraine conflict, which had triggered market volatility across the world. Markets experienced turbulence, but they eventually stabilised,” he said.
“For many investors – especially retail investors – the best strategy during such a period of uncertainty is to remain patient,” Pandey said. “News travels quickly. Opinions travel even faster. And most importantly – markets today react almost instantly to the narratives.”
The key question for policymakers and market participants is how to ensure that speed does not compromise stability, he said.
“In uncertain times, the strength of a capital market does not lie in the absence of volatility. Volatility is a natural feature of markets. The real strength lies in the confidence that the system will function fairly, transparently and efficiently even during periods of stress,” Pandey said.
SEBI has undertaken several initiatives in recent years to improve market efficiency and facilitate capital formation. These include reducing the settlement cycle to lower settlement risk and extending the scope of the Electronic Book Provider (EBP) mechanism to include REITs and InvITs. The regulator has also taken steps to simplify participation for global investors and improve operational efficiency across the market ecosystem.
Expanding investor participation is another focus area, he said.
Steps include reducing the investment threshold for privately placed bonds, revising distributor incentive structures for mutual funds and easing certain KYC requirements for non-resident investors.
India’s capital markets have expanded significantly over the past decade. Since FY15, market capitalisation has grown at a CAGR of about 15 per cent, mutual fund assets have expanded at over 20 per cent CAGR and investments in alternative investment funds have grown at more than 50 per cent CAGR.
Looking ahead, he said deeper bond markets, stronger institutional participation and continued technological innovation will be important for the next phase of development.
Published on March 14, 2026
