New Delhi, Nov 21 SEBI Chairman Tuhin Kanta Pandey on Friday said the markets regulator is actively studying whether Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) should be included in major market indices.
He said the move would be done through a calibrated, step-by-step approach and could significantly improve liquidity, visibility and institutional participation in these investment vehicles.
Speaking at an event in the national capital, Pandey described this as one of the strongest policy signals yet for India’s young REIT and InvIT market.
He said these instruments must take on a much bigger role in financing the country’s long-term infrastructure needs.
"India is already the fourth-largest REIT market in Asia, but activity remains thin. Retail participation is just 1 per cent, and trading volumes are still low," he said.
As of October, the combined assets under management of REITs and InvITs stood at Rs 9.25 trillion, across 24 listed InvITs and several listed REITs.
Pandey said SEBI is evaluating a series of changes to improve market access. "These include allowing more liquid mutual funds to invest in these instruments, treating REITs as equity to enhance liquidity, and lowering minimum investment requirements so that more people can invest," he added.
He also said large non-banking financial companies could act as anchor investors to deepen the market.
The SEBI chief stressed that India’s next phase of infrastructure development must increasingly rely on capital markets. According to NabFiD, the country will need investments of Rs 700 trillion by 2047 to support growth in sectors such as power and urban transportation.
Pandey said SEBI is working with the finance ministry and state governments to speed up public asset monetisation. He noted that public-sector bodies such as NHAI, even though they are not listed, can more easily launch InvITs. He added that procedures for raising capital through IPOs and rights issues will continue to be streamlined.
While emphasising that governance and investor protection remain crucial, Pandey said more communication is needed to encourage wider participation.
"Investor surveys show that people prefer information in languages they are comfortable with, making simplified and accessible outreach important for the growth of these products," he mentioned.
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