Mumbai (Economy India): Securities and Exchange Board of India (Sebi) Chairman Tuhin Kanta Pandey on Wednesday said that the resolution of trade frictions through bilateral trade agreements—such as the recent deal with the United States—helps remove uncertainty from the economic environment and can significantly accelerate capital formation.
Responding to a query on whether the trade deal with the US would encourage higher foreign investment inflows into India, Pandey said such agreements have the potential to spur investment decisions by improving policy clarity and market confidence.
“Fundamentally, when there is an overhang of regulatory action and trade-related uncertainty, investment decisions tend to be delayed. Once those frictions are removed, capital formation always accelerates,” Pandey told reporters in Mumbai.
Boost to Investor Confidence
Pandey’s remarks come at a time when India is seeking to strengthen its position as a preferred global investment destination amid shifting trade dynamics and supply chain realignments. Trade agreements, he noted, play a key role in reducing risk perception for both domestic and foreign investors.
Market participants believe that clearer trade frameworks and regulatory certainty can encourage long-term investments across sectors, particularly in manufacturing, infrastructure, and financial markets.
Positive Signal for Capital Markets
The Sebi chief’s comments underline the broader view that policy stability and reduced trade barriers are critical for sustaining capital inflows and deepening India’s capital markets. Improved investor confidence, analysts say, could translate into higher foreign portfolio investment and stronger private sector participation in growth-oriented projects.
(Economy India)
