Sebi to review position limits for non-agricultural commodity contracts to boost liquidity

Key facts

• Securities and Exchange Board of India (Sebi) chairman Tuhin Kanta Pandey announced that the regulator is examining position limits for non-agricultural commodity derivative contracts to improve liquidity and depth without weakening risk controls.
• Sebi has completed consultations on the matter and guidelines will follow, with a phased approach considered for physical settlement in some agricultural commodities.
• Sebi is engaging with stakeholders on GST-related issues affecting participants who give or receive commodities through exchange platforms.
• Sebi will strengthen investor awareness efforts under Project Jagrook to spread awareness about commodity derivatives among farmers, farmer producer organisations (FPOs), MSMEs, hedgers and other market users.
• Last month, the Sebi board approved a proposal to allow foreign portfolio investors (FPIs) to participate in physically settled, non-agricultural commodity derivative contracts, subject to safeguards.
• Pandey made the announcements at an event organised by the Commodity & Capital Market Participants Association of India (CPAI).