The Securities and Exchange Board of India (Sebi) has proposed significant changes to the client-level position limits for agricultural commodity derivatives, aiming to double these limits across various categories. The current limits, set in 2017, are designed to curb excessive speculation and mitigate market risks. The proposed increase would raise the limit for broad category commodities from 1% to 2% of deliverable supply, while sensitive commodities may see an increase from 0.25% to 0.5%. The new definitions would allow commodities to qualify for the broad category based on either a minimum deliverable supply of 10 lakh metric tonnes or a monetary value of ₹5,000 crore (approximately $600 million USD). Additionally, Sebi plans to revise the penalty framework for violations, linking penalties to the extent of the breach and introducing caps on monetary penalties. These changes are expected to enhance liquidity and facilitate better price discovery in the agricultural commodity derivatives market.