Rules for direct listing in GIFT City to be out in June, says IFSCA chairman

K. Rajaraman Chairperson IFSCA

The government and policy makers are working on drafting a framework that would allow Indian companies to directly list on exchanges in GIFT City; the rules for the same are expected to come out in June itself.

The amended regulations for direct listing in GIFT City exchanges will be out by the end of this month, said K Rajaraman, Chairman, International Financial Services Centres Authority (IFSCA), which is the regulatory body for Gujarat-based GIFT City -- India’s first and only IFSC.

Once the regulations are in place, companies are expected to file their applications with the regulator in the next two months, he added while speaking at an event at the BSE.

This assumes significance as currently there are no companies listed on the exchanges in GIFT City, which became operational in April 2015, and the government has repeatedly said that such direct listing would be allowed soon.

Early this year in January, Finance Minister Nirmala Sitharaman, while speaking at the Vibrant Gujarat Global Summit, had said that she was confident that direct listing of companies at GIFT City would be enabled at the earliest.

“The much-awaited matter of direct listing of stocks in GIFT IFSC was announced earlier. We are going through the process in a very systematic manner and I am confident that it will happen at the earliest. With that Indian companies should be able to access global funds easily being listed in India,” she had said.

However, the process is still on even as there are two exchanges – India International Exchange (India INX) and NSE International Exchange (NSE IX) -- located at the GIFT City.

Meanwhile, Rajaraman has clarified that the regulator cannot advise companies on where they should be listed – whether in India or in GIFT City – but it can provide options and let them choose the one most viable for them.

“Our agenda for 2047 is not that Indian companies remain in India, but Indian companies becoming global champions,” said Rajaraman. He further said if Indian companies have to become global champions, the regulators need to provide them with all types of capital - dollar or rupees.

“It depends on the company, if they want to deal in INR, they can list in India but if they want to deal in a Dollar or a Euro market, they can list in GIFT City,” said the chairman.

The IFSCA develops and regulates financial products, financial services and financial institutions at GIFT City. Prior to the establishment of the IFSCA, the domestic financial regulators, namely, RBI, SEBI, PFRDA, and IRDAI jointly regulated business at the IFSC.

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