SEBI Proposes GARUDA Green-Channel for AIF Launches

The Securities and Exchange Board of India (SEBI) proposed GARUDA, a green-channel mechanism for Alternative Investment Funds (AIFs), on 11 May 2026. GARUDA stands for Green-Channel: AIF Rollout Upon Document Acknowledgement and is linked to the filing and acknowledgement of Placement Memorandums (PPMs) for AIF schemes in India.

Alternative Investment Funds in India

Alternative Investment Funds are privately pooled investment vehicles regulated by SEBI under the SEBI (Alternative Investment Funds) Regulations, 2012. AIFs in India are classified into Category I, Category II and Category III, and they include venture capital funds, private equity funds, hedge funds and angel funds.

Proposed Green-Channel Process

SEBI proposed to reduce the launch time for regular AIF schemes from 30 days to 10 working days after filing the PPM through a merchant banker, if SEBI raises no objections. For the first scheme of an AIF, launch would be allowed from the date of registration or after 10 working days of filing the application, whichever is later.

Accredited Investor-only Schemes and Angel Funds

For Accredited Investor-only schemes and Angel Funds, SEBI proposed direct filing of PPMs with the regulator without routing them through a merchant banker. These schemes would be allowed to launch immediately after filing the PPM, and the merchant banker due diligence certificate would be replaced by undertakings from the AIF manager’s Chief Executive Officer and Compliance Officer.

Important Facts for Exams

• SEBI is the statutory regulator for securities markets in India under the SEBI Act, 1992.
• Placement Memorandum is the key disclosure document for an AIF scheme.
• Merchant bankers are regulated intermediaries under the Indian securities market framework.
• Angel Funds are a sub-category of AIFs that pool money from angel investors for start-ups.

Industry Size and Public Consultation

The number of registered AIFs in India rose to 1,849 as of 31 March 2026 from 732 five years earlier. Cumulative commitments in the AIF industry reached ₹15.74 lakh crore as of 31 December 2025, and SEBI invited public comments on the proposal until 1 June 2026.