India allows companies to list on Modi’s main financial hub to attract foreign investment.

India allows companies to list on Modi's main financial hub to attract foreign investment.

India Allows Companies to List on New Financial Hub, GIFT City

GIFT City

In a significant move, the Indian government has opened up new avenues for Indian firms to access foreign capital. Finance Minister Nirmala Sitharaman announced on Friday that companies can now list on exchanges registered in the International Financial Services Centre (IFSC) located in the Gujarat International Financial Tech City (GIFT). This decision marks a major step towards providing Indian companies with easier and cheaper access to foreign investment.

GIFT-IFSC, a tax-neutral financial center, aims to position itself as a strong competitor to global financial hubs like Singapore. It offers various fiscal incentives and a more favorable regulatory environment for companies to operate in. Prime Minister Narendra Modi’s flagship project, GIFT City, houses the IFSC, which comprises two stock exchanges, a commodity bourse, and a bullion exchange.

Previously, Indian companies could only list on foreign exchanges through instruments such as depository receipts. However, this new development allows both listed and unlisted companies to directly list their shares on the IFSC exchanges, eliminating the need for complicated financial arrangements.

This move comes after the recent shift of SGX Nifty, previously traded on the Singapore Exchange’s platform, to NSE’s International Exchange in GIFT City. Such a migration indicates a growing trust in GIFT City as a reliable financial hub.

The Indian government’s decision to enable direct listing on IFSC exchanges is part of its broader plan to enhance the country’s capital markets. In 2020, the government had initially proposed allowing companies to have their primary listings on foreign exchanges. However, opposition from nationalist groups like the Swadeshi Jagran Manch, the economic wing of the ruling party’s ideological parent, caused the plan to be put on hold. Instead, the government focused on strengthening Indian capital markets.

Through the IFSC route, Indian companies can now access the benefits and advantages of foreign capital, while simultaneously bolstering their own capital markets. This move not only provides easier access to global investors but also encourages domestic companies to thrive in an internationally competitive environment.

Overall, the decision to allow companies to list on the IFSC exchanges in GIFT City marks an important milestone in India’s efforts to become a prominent player in the global financial landscape. With its tax-neutral status, attractive incentives, and simplified regulatory framework, GIFT City is poised to emerge as a leading destination for companies seeking foreign capital. This bold move paves the way for increased foreign investments, innovations, and economic growth in India.

Ukraine acquired erratic North Korean rocke...
DeSantis board wins against Disney as judge...
Will Hurd, former GOP congressman, booed of...
Sigma Lithium CEO in talks with potential b...
Italy approved for 18.5 billion euros in po...
Justice Alito ‘No provision in the Co...
Business

Business