SEBI proposes simplified norms for low-risk FPIs

Consultation Paper Dated 08.08.2025

SEBI Issues Consultation Paper on Easing FPI Investments

The Securities and Exchange Board of India (SEBI) has released a Consultation Paper inviting public comments on a set of proposals aimed at making it easier for low-risk Foreign Portfolio Investors (FPIs) to invest in India. The key objective is to simplify onboarding procedures and reduce compliance requirements for specific categories of FPIs, such as government-owned funds and regulated public retail funds, which are generally considered low-risk.

Simplified Registration for SWAGAT-FIs

One of the significant proposals in the Consultation Paper is to allow SWAGAT-FIs (Sovereign Wealth Funds, Government-Affiliated Trusts, and other similar entities) to register as Foreign Venture Capital Investors (FVCIs) without the need to submit additional documents. This measure is expected to reduce procedural delays and improve ease of access for such entities looking to participate in the Indian investment ecosystem.

Extended Compliance Timelines

In another investor-friendly step, SEBI has proposed extending the timelines for various regulatory requirements applicable to SWAGAT-FIs. This includes granting a 10-year period for registration continuance, payment of applicable fees, and completion of the Know Your Customer (KYC) review process. The extended timelines aim to enhance operational flexibility and promote long-term investment commitments.

Public Feedback and Next Steps

SEBI has invited stakeholders, market participants, and the general public to submit their comments and suggestions on the proposed measures. The feedback will be reviewed and considered before finalising the regulatory changes. This initiative is part of SEBI’s ongoing efforts to streamline the investment process, reduce unnecessary compliance burdens, and attract more foreign capital into the Indian markets.

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