Gandhinagar

National Stock Exchange(NSE), India’s leading stock exchange, intends to establish an international exchange in GIFT SEZ area, a multi-services Special Economic Zone(SEZ) being developed as India’s first International Financial Service Centre(IFSC) by GIFT SEZ Ltd, a wholly-owned subsidiary of Gujarat International Finance Tec-City Company Ltd(GIFTCL) known as GIFT City.

GIFT SEZ and NSE signed the Memorandum of Understanding(MoU) in the presence of Shri Saurabhbhai Patel, FInance Minister of Gujarat today at Gandhninagar.

NSE intends to develop an international standard exchange providing electronic platform for facilitating trading, clearing and settlement of securities, and shall explore possibility of starting trading facilities in different asset classes like equities, interest rates, currencies, among others and their derivatives subject to fulfillment of existing laws and guidelines as are being issued by the government and the regulators. The exchange can cater to international and other investors willing to operate from GIFT SEZ-IFSC in GIFT City.

GIFT SEZ has been notified as an international financial service centre by Govt of India as India’s first IFSC. Int he absence of an ISFC in India, the country has reportedly lost market share in few financial products. Once operationalsed, IFSFC GIFT can fulfill trading needs of domestic and foreign traders, subject to regulator’s guidelines. Moreover, many institutions and people may opt to hedge their underlying risks in foreign currency denominated products from India. For instance, the trading volumes of the rupee and India-based indices are estimated at over USD 100 billion a day.

Overseas venues like SGX (in Singapore), DGCX( at Dubai) and CME ( in Chicago, and worldwide), and the global OTC and NDF markets, have been very successful in this trading. By establishing international exchange in GIFT IFSC, if even a small slice of this trading comes back to India through the international exchange set up in IFSC-GIFT by NSE, it would be a substantial achievement for India. It will also help international companies raise finance from other international investors within the international finance centre which can compete on rules, regulations and ease of business with other international finance centres wuch as Hong Kong, Singapore, Dubai and London.

Welcoming this major development for Gujarat, Shri Saurabhbhai Patel said “Developing country’s first IFSC at GIFT has been the vision of Shri Narendra Modi. Presence of NSE at GIFT for operating international exchange is the testimony to the recognition of GIFT City emerging as a preferred destination for IFS in the country. This MoU would go a long way in establishing country’s first international exchange with participation of global institutions. Gujarat govt with the help of Central govt is taking al necessary steps to fast track the development of GIFT City which will transform state of Gujarat and India as a whole and create large number of jobs.” In fact it may be recalled that this is the second MoU that NSE has signed in Gujarat in less than 100 days. The first MoU was with the Gujarat govt on financial education at school level.

Ms. Chitra Ramkrishna, MD & CEO, NSE said, “NSE being a wold class institution wants to be a part of this initiative. We consider recognition of GIFT SEZ as IFSC by Govt of India as a major step forward to serve the financial industry at large. We at NSE, would like to be a part of the vision of the govt to develop international financial service centre in India. This will help the nation to compete with other similar destinations. This will allow Indian and international entities to deal in financial products and services from India, making GIFT-India as one of the foremost international financial centres in the world.”

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