SEBI chief not worried about foreign fund outflows, says working to cut FPI registration time

SEBI chairman Tuhin Kanta Pandey

The Securities and Exchange Board of India’s (SEBI’s) chairman Tuhin kanta Pandey expressed confidence in India’s growth story, dismissing concerns over outflows in the last two years.

The market regulator’s chief told the Times of India that foreign equity flows react to global conditions and therefore the outflows are “really not that worrying”.

Pandey, in an interview with the paper, said the assets under the custody of foreign portfolio investors remains upward, growing from $827 billion to approximately $907 billion with a 10-year CAGR of 12 percent.

The SEBI chief said that FPIs consider several factors before investing, including PE ratio compared to the peers, emerging markets such as China, Hong Kong, Taiwan and Korea, where “a lot of flows have gone”.

Moreover, Pandey reasoned that India has “strong” macroeconomic fundamentals and the funds will certainly be there where the growth is.

In addition, he lauded the country’s domestic institutions and retail investors. Pandey said the primary market is the most active in the world as of now and it shows that a steady stream of domestic money is finding good quality papers.

Separately, in an interview with the Financial Express, Pandey said the market regulator is working to bring down the registration process of FPIs from “three months to a few days”.

Pandey told FE that SEBI will make the registration process "as good as anywhere" in the world. The regulator will make the registration process fully digital and make it mandatory only for new applications, FE said. As of now, registrations process could take up to 6 months, FE reported.