Indian companies granted direct listing on GIFT-IFSC international exchanges

The Indian government has given the green signal for the direct listing of securities by Indian companies on the international exchanges of GIFT IFSC to enhance foreign investments.

This is based on a PTI report.

The Department of Economic Affairs (DEA) in the Ministry of Finance has made amendments to the Foreign Exchange Management (Non-debt Instruments) Rules, introducing the 'Direct Listing of Equity Shares of Companies Incorporated in India on International Exchanges Scheme.'

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Simultaneously, the Ministry of Corporate Affairs (MCA) has rolled out the Companies (Listing of Equity Shares in Permissible Jurisdictions) Rules, 2024.

Finance Minister Nirmala Sitharaman, in an announcement on July 28 last year, expressed the government's commitment to enabling the direct listing of Indian companies at GIFT-IFSC exchanges in the first phase.

The Finance Ministry stated, "These, together, provide an overarching regulatory framework to enable public Indian companies to issue and list their shares in permitted international exchanges."

The move is seen as a strategic initiative to not only boost foreign investment flows but also unlock growth opportunities and broaden the investor base for Indian companies.

The new regulatory framework currently permits unlisted public Indian companies to list their shares on an international exchange. Currently, the Securities and Exchange Board of India (SEBI) is working on developing operational rules for Indian public businesses that are listed.

The designated international stock exchanges at GIFT-IFSC, namely India International Exchange and NSE International Exchange, are currently prescribed as permitted stock exchanges under the regulatory supervision of the International Financial Services Centres Authority (IFSCA).

The government's decision to allow direct listings is expected to encourage more Indian companies to explore international exchanges, providing them with access to a broader pool of investors. The move aligns with the government's vision to position GIFT-IFSC as a global financial hub and attract foreign capital.

(With inputs from PTI)