MUMBAI: The Securities and Exchange Board of India (Sebi) has proposed a financial threshold to determine which market indices will fall under its regulatory oversight.
In a consultation paper released on Monday, the regulator said any index tracked or used as a benchmark by domestic mutual fund schemes with cumulative assets under management (AUM) of more than ₹₹20,000 crore will be designated a “significant index” and brought under the Index Provider Regulations introduced in 2024.
The proposal is aimed at improving transparency and accountability in the governance and administration of indices, Sebi said.
The market watchdog has recommended computing cumulative AUM using the daily average AUM of domestic mutual fund schemes for each month over the preceding six months. The assessment would be carried out twice a year, as of 30 June and 31 December.
If a mutual fund scheme tracks more than one index or benchmark, only the portion of AUM attributable to each index will be considered. In the case of an index of indices, AUM tracking the underlying indices will be included in proportion to their respective weights.
“Some schemes such as thematic schemes are made for specific investors and may not be benchmarking significant indices. Sebi has brought in the framework to differentiate the same,” said DP Singh, deputy managing director and joint chief executive officer at SBI Mutual Funds.
Sebi said the proposed threshold and calculation methodology were finalized following internal deliberations and discussions with the Association of Mutual Funds in India (Amfi).
Applying this methodology to mutual fund AUM data from 1 January-30 June 2025, the regulator has identified 47 “significant indices” across equity, debt and hybrid categories. These are administered by BSE Index Services, NSE Indices and CRISIL, and include widely tracked benchmarks such as the BSE Sensex, Nifty 50, Nifty Bank, Nifty 500 and BSE 500, along with several sectoral, duration-based and money market indices.
Under the draft circular, providers of these significant indices will be required to apply for registration with Sebi as index providers within six months of the circular being issued.
The requirement will not apply to index providers whose significant indices are regulated by the Reserve Bank of India (RBI), including benchmarks notified by the central bank.
Sebi also clarified that the grievance redressal mechanism under the Index Provider Regulations will apply only to significant indices offered by index providers registered with the regulator. Subscribers to such indices will be able to access grievance redressal under the SEBI framework.
The regulator has invited public comments on the consultation paper until 10 February 2026.
