India regulator proposes expanded bullion vault oversight rules

India’s market regulator, SEBI, proposed broadening oversight of vault managers handling physical bullion that backs SEBI-regulated products. The consultation would extend the current gold-backed Electronic Gold Receipts framework to cover all physical bullion underlying products such as bullion ETFs and derivatives. The move is aimed at tightening operational standards and custody controls across India’s growing electronic gold market, where investors are increasingly favoring paper-linked gold exposure over direct physical ownership. The proposal is out for public comment until September 1. The likely market impact is modest in the near term, but the rules could improve transparency and trust in bullion-linked financial products over time, which may be supportive for gold-backed instruments and related vaulting infrastructure.