The Evolving Regulatory Architecture In India: A Critical Analysis Of SEBI’s 2024-25 Reforms On FPIs And AIFs
- IJLLR Journal
- Oct 7
- 1 min read
Tamanna Jindal, LL.M., National Law Institute University (NLIU), Bhopal
ABSTRACT
In 2024-25, the Securities and Exchange Board of India introduced sweeping reforms in the governance of Foreign Portfolio Investors and Alternative Investment Funds. These measures include higher beneficial ownership disclosures, anti-layering rules, and enhanced monitoring of concentrated holdings. This development represented significant push towards improving transparency in India's capital markets. The reforms were primarily prompted by concerns regarding round-tripping, money laundering, and market events like the Adani-Hindenburg controversy, and aimed to strengthen market integrity and align India with global best practices. This article provides a critical examination of these reforms and their potential impact on securities regulation, foreign investment, and corporate governance. The reforms also present significant challenges, such as higher compliance costs for smaller managers, the risk of capital flight to less regulated jurisdictions, and potential legal challenges. If carefully implemented, these reforms will mark a potential turning point in India’s financial governance, and signal a strategic shift from pursuing foreign inflows at any cost to demanding that capital must possess integrity, accountability, and transparency.
Keywords: Securities and Exchange Board of India, 2024-25 Reforms, Foreign Portfolio Investors, Alternative Investment Funds, Beneficial Ownership and Disclosure.
