Discuss the challenges in balancing ease of compliance for issuers with investor protection in India's securities market regulation.

The SEBI Act, 1992 charges the regulator with protecting investors while developing and regulating the securities market [1] — twin mandates that pull against each other, since every safeguard adds a compliance layer. SEBI's 2026 review of the issue-proceeds disclosure framework shows this balance is still being calibrated [6].

Volume of disclosure vs. its usefulness

• Continuous disclosure duties under the LODR Regulations, 2015 have expanded steadily; bulk filings can bury price-sensitive information, causing "disclosure fatigue" without better-informed investors [3].
• SEBI Chairman Tuhin Kanta Pandey [5] frames true transparency as quality, timeliness and usefulness, not volume [6].

Monitoring the end-use of capital raised

• Diversion of IPO proceeds is a classic retail-investor risk; the ICDR Regulations therefore require a monitoring agency and periodic reporting on utilisation once issue size crosses the prescribed threshold [2].
• The issuer–monitoring agency–exchange chain, however, slows reporting; the current review seeks timelier disclosure with simpler compliance [6].

Related-party transactions (RPTs)

• Regulation 23, LODR mandates audit-committee vetting and prior shareholder approval for material RPTs, with related parties abstaining from voting [3].
• Wide definitions sweep in routine intra-group dealings, so SEBI has consulted publicly on recalibrating thresholds and clarifying requirements [4], and proposes further clarity while retaining safeguards [6].

Structural constraints

• Information asymmetry: retail investors depend almost wholly on issuer-generated data, so dilution of norms hits them first.
• Scale effects: smaller and SME issuers bear proportionally higher compliance costs, raising the cost of capital.
• Regulatory churn: SEBI amends regulations through its own rule-making power [1] — agile, but frequent change breeds uncertainty for issuers.

The real task is not deregulation versus regulation but designing disclosures that are proportionate, timely and decision-useful. Scale-linked thresholds, consultation before amendment [4], and technology-enabled monitoring can lower issuer burden without diluting safeguards — sustaining the investor trust on which deepening India's primary market ultimately rests.