India, June 12 -- The Securities and Exchange Board of India (SEBI) released a consultation paper last month that could streamline co-investment strategies within the country's private equity and venture capital (PE/VC) sector, unlocking new avenues for investment and advisory services. Made public on May 9, the paper has proposed two critical reforms.

First, it aims to replace the current co-investment framework, which is routed through PMS (portfolio management services) entities, requiring a separate licence and leading to numerous operational and compliance complexities. Instead, co-investments will be made via Co-Investment Vehicles (CIVs) within the framework of Alternative Investment Funds (specifically, categories I and II PE/VC ...