SEBI Chief Tuhin Kanta Pandey Says Indian Markets Can Absorb West Asia Crisis Shocks

India’s capital markets regulator believes domestic financial markets remain structurally resilient despite rising uncertainty caused by the ongoing conflict in West Asia and its impact on global energy prices. 

SEBI Flags Global Spillover Risks 

As per the PTI report, Tuhin Kanta Pandey, Chairman of Securities and Exchange Board of India, said the current geopolitical tensions have increased volatility across financial markets globally due to disruptions in oil supply chains and rising crude prices. 

Speaking during the Regional Investors Seminar for Awareness, Pandey noted that inflationary risks, spillover pressures and secondary economic impacts are emerging across economies as a result of the conflict. 

He stated that when instability develops in one part of the world, its effects eventually spread across interconnected global financial systems. 

Indian Markets Seen as Structurally Resilient 

Despite elevated uncertainty, Pandey said Indian markets possess the capacity to “absorb different types of shocks” and generally return to their “normal trajectory” once external disruptions ease. 

He also acknowledged that foreign portfolio investment outflows have continued since September 2024, reflecting global investor caution amid volatile international conditions. 

However, according to the SEBI chairman, domestic investors have continued showing confidence in Indian markets despite fluctuations. 

Pandey added that market volatility and periodic corrections remain natural because financial markets across countries are deeply interconnected. 

Oil Prices and Inflation Remain Key Concerns 

The comments come as the ongoing West Asia conflict continues affecting global crude oil supply chains and energy prices, increasing concerns around imported inflation and broader macroeconomic pressures. 

Higher energy costs remain closely watched by investors and policymakers, given their impact on inflation, trade balances, and corporate profitability across economies. 

Read More: FPIs Withdraw ₹27,048 Crore in May as Global Risks Pressure Indian Equities! 

Conclusion 

While geopolitical tensions continue influencing global financial sentiment, SEBI believes India’s market structure and sustained domestic investor participation are helping cushion the impact of external shocks. 

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