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VOL. 11, ISSUE 8 (2025)
A study on the challenges faced by SEBI in regulating foreign institutional investments (FIIs) and their impact on India's economy
Authors
Nadia Nudrat, Dr. Mahajabeen Parveen
Abstract
The Securities and Exchange Board of India (SEBI) has been entrusted
with the crucial role of regulating foreign institutional investments (FIIs) in
the Indian market. The increasing inflow of FIIs into India has brought about
significant changes in the country's economic landscape, making it a top
destination for foreign investors. However, this surge in FII activity has also
posed numerous challenges for SEBI in effectively managing and regulating these
investments. This study aims to identify some of the major challenges faced by
SEBI in its attempt to regulate FIIs and analyze their impact on India's
economy. One of the primary challenges faced by SEBI is ensuring compliance
with regulatory norms by FIIs. These entities are subject to different regulations
both at home country and host country levels, making it difficult for SEBI to
monitor their activities effectively. Moreover, due to their large capital base
and high-risk appetite, FIIs can have a significant influence on stock prices
which can lead to market volatility. Another challenge for SEBI is dealing with
complex financial instruments used by FIIs such as derivatives which require
specialized knowledge and expertise from regulators.
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Pages:87-90
How to cite this article:
Nadia Nudrat, Dr. Mahajabeen Parveen "A study on the challenges faced by SEBI in regulating foreign institutional investments (FIIs) and their impact on India's economy". International Journal of Commerce and Management Research, Vol 11, Issue 8, 2025, Pages 87-90
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