International Financial Services Centres Authority chairman Injeti Srinivas Ahmedabad on Monday inaugurated a logo for GIFT Nifty, the new identity given to SGX Nifty.
A website for GIFT exchange was also launched on the occasion at Gift City here. The SGX Nifty will come to exist as Gift Nifty from July 3. This is an initiative of NSE IX and SGX that enables Gift Nifty orders from SGX members to be routed to the NSE IFSC for trading and execution with clearing and settlement through SGX Derivatives Clearing.
Srinivas said the IFSCA aims to develop the IFSC as a global gateway for inbound and outbound requirements of international financial services.
“Given the growing influence of international investors in India’s growth story, the establishment of international exchange at the GIFT (Gujarat International Finance Tec-City) will provide an opportunity to reach out to global investors who are not engaging with the Indian market directly. The sponsored and unsponsored depositary receipts of Indian stocks provided via GIFT Nifty will replace the investment via P-Note and FPI route, which will bring transparency and visibility,” he added.
He stressed that the main plus points for GIFT Nifty are “its separate financial jurisdiction which is distinct from domestic jurisdiction, availability of full capital account convertibility, rules and regulations aligning international standards, competitive and interactive tax regime, lower operational cost and benefits of ease of doing business”.
The exchange will provide trading services for 21 hours in a day and will be functioning in two shifts, overlapping Asia, Europe and US trading hours. The first shift will start from 06.30 am in the morning and end at 3.40 pm while the second shift of trading will start from 4 pm and continue till 2.45 am in the morning.
Srinivas said, “The objective behind GIFT is to onshore the offshore transactions conducted by Indian entities.”
Commenting on the progress in GIFT, Srinivas said, “Banking, fund management, bonds market and bullion exchange are the thriving financial services in GIFT.”
“Total banking transactions here have crossed $ 500 billion and banking services are catering to the demands generated from the whole of South Asia. We have robust fund management regulations that align with the international regulations. The bond market has crossed $ 72 billion out of which $ 10 billion is under sustainable finance and India International Bullion Exchange (IIBX) started taking off and it can clear the entire transaction in just 30 minutes,” he added.
V Balasubramaniam, MD & CEO of NSE IX, said, “The GIFT Nifty is an umbrella brand. It includes four indices–Gift Nifty 50, Gift Nifty Bank, Gift Nifty Financial Services and Gift Nifty IT”.
He said the GIFT exchange will be the middle point for domestic and international traders and they are planning to have similar contracts with other international exchanges also.
“The benefit of having international exchange onshore is that it will allow domestic investors to take part in international trading and provide an option for listed and non-listed companies to get listed at GIFT, and be able to raise capital in foreign currency,” said Balasubramaniam.