In a recent address, Tuhin Kanta Pandey, chairperson of the Securities and Exchange Board of India (Sebi), highlighted the dual nature of artificial intelligence (AI) in securities regulation. While AI enhances surveillance and fraud detection, it poses risks such as opacity, bias, and power concentration. Pandey emphasized the need for regulation to evolve towards technology supervision, noting that algorithmic trading and digital platforms are reshaping markets faster than regulatory frameworks can keep pace. He underscored the importance of addressing interconnectedness risks and enhancing data governance. Sebi’s initiatives include employing supervisory technology (SupTech) and regulatory technology (RegTech) to manage these challenges effectively. With India’s market capitalization quadrupling over the past decade, the focus is shifting from entity oversight to activity-based regulation. Pandey urged for anticipatory regulations that adapt to market dynamics, ensuring resilience amid technological shifts, thereby embracing India’s transformative equity landscape.
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