The International Financial Services Centres Authority (IFSCA) will come out with regulations to enable direct listing on the IFSC exchanges over the next three to four months.
“We already have a working group, which is coordinating with other regulators such as the Securities and Exchange Board of India and the Reserve Bank of India. We believe that the necessary procedures and amendments should be completed within the next three months. We should be able to make the decision to go live by the end of this year,” said IFSCA Chairperson K Rajaraman while addressing the global fintech festival in Mumbai.
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At present, Indian companies can access overseas equity markets only through depository receipts or by listing their debt securities on foreign markets. In 2020, the Centre amended the Companies Act, allowing the direct listing of Indian companies on foreign stock exchanges, but the framework has not been put in place so far.
In July, Union Finance Minister Nirmala Sitharaman had announced that the government has taken a decision to enable direct listing of listed and unlisted companies on the IFSC exchanges.
The move will enable “start-ups and companies of like nature to access the global market through GIFT IFSC”, Sitharaman had said. “This will also facilitate access to global capital and result in better valuation for Indian companies.”
Rajaraman also said a separate payments system regulations — similar to that of the real time gross settlement (RTGS) for banking — will be launched within a few months to facilitate instant settlements.
‘’We are coming up with payments regulations shortly, maybe in the next few months. This will enable regulated entities to provide these services to ensure instant settlement of payments,’‘ he said.
Currently, such payments are cleared through the banking system, which is time-consuming. ‘’We believe that with these regulatory tweaks, we should be able to achieve substantial traction in terms of clearing the ground for some foreign players to move in to Gift City in a significantly large number,’‘ he added.