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SEBI Introduces Framework for ‘Significant Indices’ with ₹20,000 Crore AUM Threshold and Enhanced Governance Norms
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The Securities and Exchange Board of India (SEBI) has established a comprehensive framework to identify and regulate “significant indices” in the Indian financial market, introducing a threshold of ₹20,000 crore in average assets under management (AUM). An index will be classified as “significant” if the combined AUM of mutual fund schemes tracking or benchmarking it remains above this limit for the preceding six months. To ensure consistency and periodic evaluation, this classification will be reviewed on a half-yearly basis, specifically as of June 30 and December 31 each year.
This initiative follows the implementation of the SEBI (Index Providers) Regulations, 2024, which aim to enhance transparency, accountability, and governance in index administration. The regulations are intended to bring greater structure to the functioning of index providers, ensuring that indices influencing large volumes of investments are managed in a fair, transparent, and well-regulated manner. As part of this framework, entities managing such significant indices are required to adhere to prescribed compliance standards, including mandatory registration with SEBI within a period of six months from the date of applicability.
The scope of these regulations is limited to indices that consist of securities listed on recognised stock exchanges in India. SEBI has further clarified that once an index is designated as “significant,” it will continue to retain this classification even if there are short-term fluctuations in AUM. The status will only be revoked if the AUM linked to the index falls below the ₹20,000 crore threshold continuously for a period of three years, thereby ensuring stability and avoiding frequent reclassification.
Moreover, to provide clarity and immediate applicability of the framework, SEBI has published an initial list of 48 indices that currently qualify as “significant.” This list has been determined based on AUM data for the period from July to December 2025. The move is expected to strengthen investor confidence and improve the overall integrity of index-linked investment products in India.
This initiative follows the implementation of the SEBI (Index Providers) Regulations, 2024, which aim to enhance transparency, accountability, and governance in index administration. The regulations are intended to bring greater structure to the functioning of index providers, ensuring that indices influencing large volumes of investments are managed in a fair, transparent, and well-regulated manner. As part of this framework, entities managing such significant indices are required to adhere to prescribed compliance standards, including mandatory registration with SEBI within a period of six months from the date of applicability.
The scope of these regulations is limited to indices that consist of securities listed on recognised stock exchanges in India. SEBI has further clarified that once an index is designated as “significant,” it will continue to retain this classification even if there are short-term fluctuations in AUM. The status will only be revoked if the AUM linked to the index falls below the ₹20,000 crore threshold continuously for a period of three years, thereby ensuring stability and avoiding frequent reclassification.
Moreover, to provide clarity and immediate applicability of the framework, SEBI has published an initial list of 48 indices that currently qualify as “significant.” This list has been determined based on AUM data for the period from July to December 2025. The move is expected to strengthen investor confidence and improve the overall integrity of index-linked investment products in India.
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