To improve flexibility, Sebi has introduced exemptions to pro-rata rights in alternative investment funds (AIF) regulations. Pro-rata rights will not apply if investors are excluded from specific investments, fail to meet contribution obligations, or share profits with fund managers. Certain entities, like government-backed organizations, may accept junior or subordinate units with lower returns or higher risks. These changes aim to enhance fairness, transparency, and flexibility while protecting investor rights. Sebi has also clarified that the Corporate Debt Market Development Fund is classified as a Category I AIF, serving to bolster confidence in the corporate debt market during stressful periods.