Policy Signals, Domestic Capital Push, and Market Maturity Shape India’s VC-PE Landscape

For venture capital and private equity firms, the highlights coming out of the Indian Venture and Alternate Capital Association (IVCA) Conclave 2026 reflected a broader shift: India’s private markets are moving from a startup-funding narrative toward a more institutional and policy-aligned capital ecosystem.

Below are the key highlights facing the private investment space in India: 

1. SEBI’s Plans to ease accreditation rules for AIF investors

One of the clearest regulatory signals came from the Securities and Exchange Board of India (SEBI), which indicated that it intends to simplify the accreditation process for investors participating in Alternative Investment Funds (AIFs).

Speaking at the conclave, SEBI Chairman Tuhin Kanta Pandey said the regulator is working toward making it easier for sophisticated investors to participate in private market funds.

“Sebi will further ease the accreditation process for AIF investors,” Pandey said during the conclave.

The move is expected to expand the domestic investor pool available to venture capital and private equity funds. Currently, investors must meet strict criteria and commit a minimum INR 1 crore investment to participate in most AIFs.

For fund managers, easing these requirements could gradually broaden the limited partner (LP) base beyond family offices and ultra-high-net-worth individuals.

2. AIFs have become a pillar of India’s capital markets

Secondly, experts acknowledged the rapid growth of India’s AIF industry, which has become the primary structure through which venture capital and private equity funds operate in the country.

Tuhin Pandey noted that the sector has evolved rapidly over the past decade. “Alternative investment funds have transitioned from the margins of the financial system to become an important pillar of India’s capital markets.”

Reports unveiled at the conclave indicated that total AIF commitments are approaching INR 16 lakh crore, underscoring the scale of private capital in India.

3. Government-backed SRI Fund crosses ₹12,000 crore

Another highlight discussed was the performance of the Self-Reliant India (SRI) Fund, a government-backed fund-of-funds designed to support Indian startups.

According to Saravana Kumar, Director and CEO of NSIC Venture Capital Fund, the initiative has reached a major milestone.

“The INR 12,000-crore SRI Fund has supported more than 750 companies and helped create over 1.6 lakh jobs,” Kumar said. 

The Self-Reliant India Fund operates as a fund-of-funds structure, deploying capital into SEBI-registered AIFs, which then invest in startups and growth companies. For venture capital funds, the SRI Fund has become an important domestic capital anchor, particularly for early-stage and growth-stage funds that might otherwise rely heavily on foreign LPs.

4. Capital must build resilience in a volatile world

Geopolitical risk and global economic uncertainty were also prominent themes during the conclave. SEBI Chairman Pandey emphasised that the role of private capital must go beyond financial returns, particularly in an era of supply-chain disruptions and geopolitical fragmentation.

“The current geopolitical situation serves as a reminder that capital must do more than chase returns. It must also build resilience,” said Pandey. 

This perspective suggests that policymakers increasingly expect private capital to play a role in strategic sectors such as renewable energy, manufacturing, logistics, and technology infrastructure, vital for geopolitical dominance in the current world. 

5. Governance and transparency remain a regulatory priority

While regulators expressed support for the growth of private capital, they also stressed that the industry must strengthen governance and transparency standards. SEBI spokesperson highlighted the need for improved valuation practices, risk disclosures, and investor protections as the industry grows in scale.

“We want innovation and market development to flourish, but not at the cost of market integrity or investor protection,” said the SEBI Chairman. 

Despite optimism, investors flagged structural issues such as 10-15 per cent capital gains taxes, which reduce potential returns, and Rupee depreciation vs USD, which affects global LP returns.

A report released at the event by Uniqus Consultech + IVCA highlighted that the IPO pipeline narrative was strengthening. India became a USD 5.2 trillion equity market in 2025, with INR 1.76 lakh crore raised through IPOs last year.

Taken together, the takeaways from the conclave highlight that the focus is no longer on startup funding cycles. Instead, policymakers and investors are increasingly focused on parameters such as stronger governance frameworks and deeper integration between private and public markets.