Short-Selling Rules May Change – SEBI Weighs New Plan

The Securities and Exchange Board of India (Sebi) is considering a plan to ease restrictions on short-selling of stocks. Under the new proposals, if put into action, short-selling will be permitted for all stocks but those in the trade-to-trade (T2T) segment. This will be an effort to address declining liquidity in the market due to recent regulatory hurdles and weakness in the market. Short-selling, selling of stocks not in the possession of the seller while trading, is now limited to the futures and options (F&O) segment. Sebi's rules issued in January 2024 have been awaiting clarification by brokers, who contended that enforcment of the prohibition against short-selling of non-F&O stocks rigorously would curtail cash market volumes further. 
Source: Economic Times