Pandey divulged these details while speaking on Sebi’s multi-pronged approach to develop financial instruments that would help finance and de-risk the exploration and mining of critical minerals, so that India becomes self-reliant in these vital resources.
According to Pandey, who was speaking at a keynote address, “Metals—from mines to markets”, a proposal to allow FPIs to trade in non-cash settled non-agricultural commodities contracts is currently under examination. This is part of Sebi’s approach to deepen and widen participation in the non-agricultural commodity space, which would include metals. A non-negotiable for Sebi in this space is real-time margin collection and continuous monitoring as guardrails, which would strengthen the integrity and safety of the markets.
“Our markets are for large corporations, traders, importers, and SMEs. They are also available for institutional investors like mutual funds and AIFs, who are increasingly recognising metals as an asset class that improves risk-adjusted returns for investors. Enhanced institutional participation will bring in higher liquidity, making the market more attractive for hedging,” he averred.