Mumbai: The Securities and Exchange Board of India (Sebi) plans to develop bond exchange-traded funds and derivatives linked to corporate bond indices to deepen the country's corporate debt market and broaden investor participation."These can improve liquidity, allow retail investors to access debt markets with smaller ticket sizes, and help institutions hedge interest-rate risks," said chairperson Tuhin Kanta Pandey at an event on Tuesday.The regulator is also reviewing whether debt-only listed entities should be subject to the same compliance requirements as equity-listed companies. Currently, LODR (Listing Obligations and Disclosure Requirements) obligations for pure debt-listed entities are similar to those for equity-listed firms."The review will be to relax some of these LODR obligations for pure debt-listed entities. We will take up this review in due course," Pandey said.Outstanding corporate bonds have increased from around ₹17.5 lakh crore at the end of FY15 to over ₹59 lakh crore currently, reflecting a compound annual growth rate of around 12%, according to Sebi data.Average annual fundraising through debt markets stood at around ₹8 lakh crore between FY21 and FY25, while debt issuances in FY26 raised ₹9.1 lakh crore - nearly twice the amount mobilised through equity markets."But scale alone is not enough. The real test is diversity, liquidity, and wider participation," Pandey said.Sebi is also exploring a distinct regulatory classification for debt brokers."This can lower costs, reduce entry barriers, and encourage dedicated debt-market intermediaries," Pandey said.The regulator is also considering a pilot project for the tokenisation of corporate bonds using digital ledger technology."We are exploring a pilot for tokenisation of corporate bonds. The pilot will test whether tokenisation can deliver faster settlement, better traceability, automated servicing, and greater transparency. We must move carefully - but we must remain open to useful innovation," Pandey said.Depositories currently use digital ledger technology."This is basically an instantaneous settlement with all the benefits of tokenisation. We also need to take on board the risks associated with tokenisation, especially on the quantum side. We will put together a consistent view from all stakeholders and develop a technology and operational model," he added.